Insights into Upbound Group Inc's Dividend Performance and Sustainability
Upbound Group Inc(UPBD, Financial) recently announced a dividend of $0.34 per share, payable on 2023-10-24, with the ex-dividend date set for 2023-10-02. As investors eagerly anticipate this forthcoming payment, the company's dividend history, yield, and growth rates also come under scrutiny. Using GuruFocus data, we delve into Upbound Group Inc's dividend performance and evaluate its sustainability.
Understanding Upbound Group Inc's Business
Upbound Group Inc is an omnichannel platform company committed to elevating financial opportunity for all through inclusive, and technology-driven financial solutions that address the evolving needs and aspirations of consumers. It has four operating segments; The Rent-A-Center Business segment operates lease-to-own stores, the Acima segment, offers the lease-to-own transaction to consumers who do not qualify for financing from the traditional retailer, and also offers the lease-to-own transaction through virtual offering solutions across e-commerce, digital, and mobile channels, Mexico segment offers lease-to-own stores in Mexico. The franchising segment offers the sale of rental merchandise to its franchisees. The company derives a majority of its revenue from the Acima segment.
Upbound Group Inc's Dividend History: A Snapshot
Upbound Group Inc has maintained a consistent dividend payment record since 2019. Dividends are currently distributed on a quarterly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Decoding Upbound Group Inc's Dividend Yield and Growth
As of today, Upbound Group Inc currently has a 12-month trailing dividend yield of 4.62% and a 12-month forward dividend yield of 4.62%. This suggests an expectation of same dividend payments over the next 12 months.
Over the past three years, Upbound Group Inc's annual dividend growth rate was 36.10%. Based on Upbound Group Inc's dividend yield and five-year growth rate, the 5-year yield on cost of Upbound Group Inc stock as of today is approximately 4.61%.
Assessing Dividend Sustainability: Payout Ratio and Profitability
To assess the sustainability of the dividend, one needs to evaluate the company's payout ratio. The dividend payout ratio provides insights into the portion of earnings the company distributes as dividends. A lower ratio suggests that the company retains a significant part of its earnings, thereby ensuring the availability of funds for future growth and unexpected downturns. As of 2023-06-30, Upbound Group Inc's dividend payout ratio is 0.00.
Upbound Group Inc's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Upbound Group Inc's profitability 7 out of 10 as of 2023-06-30, suggesting good profitability prospects. The company has reported net profit in 8 years out of past 10 years.
Looking Ahead: Growth Metrics and Future Outlook
To ensure the sustainability of dividends, a company must have robust growth metrics. Upbound Group Inc's growth rank of 7 out of 10 suggests that the company's growth trajectory is good relative to its competitors.
Revenue is the lifeblood of any company, and Upbound Group Inc's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Upbound Group Inc's revenue has increased by approximately 14.70% per year on average, a rate that outperforms than approximately 64.87% of global competitors.
The company's 3-year EPS growth rate showcases its capability to grow its earnings, a critical component for sustaining dividends in the long run. During the past three years, Upbound Group Inc's earnings increased by approximately -59.20% per year on average, a rate that outperforms than approximately 8.28% of global competitors.
Lastly, the company's 5-year EBITDA growth rate of 35.30%, which outperforms than approximately 85.53% of global competitors.
Concluding Remarks
In conclusion, Upbound Group Inc's consistent dividend payments, impressive growth rate, low payout ratio, and strong profitability and growth metrics indicate a sustainable and promising dividend story. However, investors should continue to monitor these metrics for any significant changes over time. GuruFocus Premium users can screen for high-dividend yield stocks using the High Dividend Yield Screener.
