An in-depth look into the company's dividend performance and its sustainability
SRH Total Return Fund, Inc.(STEW, Financial) recently announced a dividend of $0.13 per share, payable on 2023-10-31, with the ex-dividend date set for 2023-10-23. As investors look forward to this upcoming payment, the spotlight also shines on the company's dividend history, yield, and growth rates. Using the data from GuruFocus, let's look into SRH Total Return Fund, Inc.'s dividend performance and assess its sustainability.
What Does SRH Total Return Fund, Inc. Do?
SRH Total Return Fund, Inc. is a non-diversified closed-end management investment company. The company's investment objective is to seek total return. Its fund utilizes a bottom-up, value-driven investment process to identify securities of good quality businesses trading below estimated intrinsic value.
A Glimpse at SRH Total Return Fund, Inc.'s Dividend History
SRH Total Return Fund, Inc. has maintained a consistent dividend payment record since 2010. Dividends are currently distributed on a quarterly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down SRH Total Return Fund, Inc.'s Dividend Yield and Growth
As of today, SRH Total Return Fund, Inc. currently has a 12-month trailing dividend yield of 3.95% and a 12-month forward dividend yield of 3.99%. This suggests an expectation of increased dividend payments over the next 12 months.
Over the past three years, SRH Total Return Fund, Inc.'s annual dividend growth rate was 5.60%. Extended to a five-year horizon, this rate decreased to 3.10% per year.
Based on SRH Total Return Fund, Inc.'s dividend yield and five-year growth rate, the 5-year yield on cost of SRH Total Return Fund, Inc. stock as of today is approximately 4.60%.
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 2023-05-31, SRH Total Return Fund, Inc.'s dividend payout ratio is 0.00.
SRH Total Return Fund, Inc.'s profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks SRH Total Return Fund, Inc.'s profitability 2 out of 10 as of 2023-05-31, suggesting the dividend may not be sustainable. The company has reported net profit in 5 years out of the past 10 years.
Growth Metrics: The Future Outlook
To ensure the sustainability of dividends, a company must have robust growth metrics. SRH Total Return Fund, Inc.'s growth rank of 2 out of 10 suggests that the company has poor growth prospects and thus, the dividend may not be sustainable.
Revenue is the lifeblood of any company, and SRH Total Return Fund, Inc.'s revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. SRH Total Return Fund, Inc.'s revenue has increased by approximately 3.90% per year on average, a rate that underperforms approximately 52.12% 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, SRH Total Return Fund, Inc.'s earnings increased by approximately 3.80% per year on average, a rate that underperforms approximately 53.74% of global competitors.
Lastly, the company's 5-year EBITDA growth rate of -14.30%, underperforms approximately 88.31% of global competitors.
Next Steps
Considering SRH Total Return Fund, Inc.'s dividend payments, dividend growth rate, payout ratio, profitability, and growth metrics, the sustainability of its dividend is questionable. The company's low growth and profitability rankings, combined with its underperformance compared to global competitors, suggest that its dividend may not be sustainable in the long run. Investors should exercise caution and consider these factors when making investment decisions.
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.
