An In-depth Look at BlackRock ESG Capital Allocation Trust's Dividend Performance and Sustainability
BlackRock ESG Capital Allocation Trust(ECAT, Financial) recently announced a dividend of $0.13 per share, payable on 2023-10-31, with the ex-dividend date set for 2023-10-13. As investors look forward to this upcoming payment, the spotlight also shines on the company's dividend history, yield, and growth rates. With data from GuruFocus, let's delve into BlackRock ESG Capital Allocation Trust's dividend performance and assess its sustainability.
What Does BlackRock ESG Capital Allocation Trust Do?
BlackRock ESG Capital Allocation Trust is a non-diversified, closed-end management investment company. The Trust's investment objectives are to provide total return and income through a combination of current income, current gains, and long-term capital appreciation.
A Glimpse at BlackRock ESG Capital Allocation Trust's Dividend History
BlackRock ESG Capital Allocation Trust has maintained a consistent dividend payment record since 2021. Dividends are currently distributed on a monthly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down BlackRock ESG Capital Allocation Trust's Dividend Yield and Growth
As of today, BlackRock ESG Capital Allocation Trust currently has a 12-month trailing dividend yield of 9.40% and a 12-month forward dividend yield of 10.07%. This indicates an expected increase in dividend payments over the next 12 months.
Based on BlackRock ESG Capital Allocation Trust's dividend yield and five-year growth rate, the 5-year yield on cost of BlackRock ESG Capital Allocation Trust stock as of today is approximately 9.40%.
The Sustainability Question: 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, BlackRock ESG Capital Allocation Trust's dividend payout ratio is 0.55.
BlackRock ESG Capital Allocation Trust's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks BlackRock ESG Capital Allocation Trust's profitability 1 out of 10 as of 2023-06-30, suggesting the dividend may not be sustainable. The company has reported net profit in 1 year out of the past 10 years.
Growth Metrics: The Future Outlook
To ensure the sustainability of dividends, a company must have robust growth metrics. BlackRock ESG Capital Allocation Trust's growth rank of 1 out of 10 suggests that the company has poor growth prospects, and thus, the dividend may not be sustainable.
Next Steps
Considering BlackRock ESG Capital Allocation Trust's dividend payments, dividend growth rate, payout ratio, profitability, and growth metrics, investors should evaluate these factors carefully before making a decision. While the company's dividend yield is attractive, its low profitability and growth ranks raise questions about the sustainability of its dividends in the long term. As always, it's important to conduct thorough research and consider all aspects of a company's financial health before investing.
GuruFocus Premium users can screen for high-dividend yield stocks using the High Dividend Yield Screener.
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
