A Comprehensive Look at Albertsons Companies Inc's Dividend Performance and Sustainability
Albertsons Companies Inc(ACI, Financial) recently announced a dividend of $0.12 per share, payable on 2023-11-14, with the ex-dividend date set for 2023-10-30. This announcement has piqued investors' interest, prompting a deeper examination of the company's dividend history, yield, and growth rates. Utilizing data from GuruFocus, we delve into Albertsons Companies Inc's dividend performance to assess its sustainability.
What Does Albertsons Companies Inc Do?
Albertsons is the second-largest conventional grocer in America, operating 2,271 stores under 24 banners in 34 states (as of the end of fiscal 2022). The company has a significant private-label operation, accounting for around 20% of sales (excluding fuel). Albertsons operates 19 food production plants and is a top two grocer in two thirds of its major markets (as of early 2022, according to company data). All of its sales come from the United States. Narrow-moat Kroger has offered to acquire Albertsons in a $25 billion deal; if approved by regulators, the deal should close in 2024.
A Glimpse at Albertsons Companies Inc's Dividend History
Since 2020, Albertsons Companies Inc has maintained a consistent dividend payment record, with dividends currently distributed on a quarterly basis. The chart below shows annual Dividends Per Share for tracking historical trends.
Breaking Down Albertsons Companies Inc's Dividend Yield and Growth
As of today, Albertsons Companies Inc currently has a 12-month trailing dividend yield of 2.21% and a 12-month forward dividend yield of 2.21%. This suggests an expectation of same dividend payments over the next 12 months. The 5-year yield on cost of Albertsons Companies Inc stock as of today is approximately 2.21%.
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 2023-08-31, Albertsons Companies Inc's dividend payout ratio is 0.24.
Albertsons Companies Inc's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Albertsons Companies Inc's profitability 6 out of 10 as of 2023-08-31, suggesting fair profitability. The company has reported net profit in 7 years out of past 10 years.
Growth Metrics: The Future Outlook
Albertsons Companies Inc's growth rank of 6 out of 10 suggests a fair growth outlook. Albertsons Companies Inc's revenue has increased by approximately 10.60% per year on average, a rate that outperforms approximately 70.34% 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, Albertsons Companies Inc's earnings increased by approximately 41.60% per year on average, a rate that outperforms approximately 81.17% of global competitors. Lastly, the company's 5-year EBITDA growth rate of 97.20%, outperforms approximately 99.4% of global competitors.
Conclusion
In conclusion, Albertsons Companies Inc's consistent dividend payments, impressive growth rate, and sustainable payout ratio make it an attractive option for dividend investors. The company's strong profitability and growth metrics further enhance its appeal. However, like all investments, potential investors should conduct their own thorough research before making a decision. 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.
