Understanding Brookfield Corp's Dividend Sustainability and Growth
Brookfield Corp (BN, Financial) recently announced a dividend of $0.07 per share, payable on 2023-12-29, with the ex-dividend date set for 2023-11-29. 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 Brookfield Corp's dividend performance and assess its sustainability.
What Does Brookfield Corp Do?
Brookfield Corp owns and manages commercial property, power, and infrastructure assets. Its investment focus includes Real Estate, Infrastructure, Renewable Power, and Private Equity. Real Estate is made up of office and retail properties; Renewable power is made up of hydroelectric, wind, solar, and storage generating facilities; Infrastructure is made up of utilities, transport, energy, data infrastructure, and sustainable resource assets; and Private Equity is focused on business services, infrastructure services, and industrial operations. The company generates the majority of its revenue through Private Equity. Located around the world, its assets are concentrated in the United States, and Canada.
A Glimpse at Brookfield Corp's Dividend History
Brookfield Corp has maintained a consistent dividend payment record since 1997, with dividends currently distributed on a quarterly basis. Brookfield Corp has increased its dividend each year since 2002, earning it the title of a dividend achiever, a distinction reserved for companies that have increased their dividend annually for at least the past 21 years. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Brookfield Corp's Dividend Yield and Growth
As of today, Brookfield Corp currently has a 12-month trailing dividend yield of 1.04% and a 12-month forward dividend yield of 0.83%. This indicates an expectation of decreased dividend payments over the next 12 months. Brookfield Corp's dividend yield of 1.04% is near a 10-year low and underperforms 93.74% of global competitors in the Asset Management industry, suggesting that the company's dividend yield may not be a compelling proposition for income investors.
Over the past three years, Brookfield Corp's annual dividend growth rate was 10.60%. Extended to a five-year horizon, this rate decreased to 9.20% per year. And over the past decade, Brookfield Corp's annual dividends per share growth rate stands at an impressive 11.10%. Based on Brookfield Corp's dividend yield and five-year growth rate, the 5-year yield on cost of Brookfield Corp stock as of today is approximately 1.61%.
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 2023-09-30, Brookfield Corp's dividend payout ratio is 0.00.
Brookfield Corp's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Brookfield Corp's profitability 8 out of 10 as of 2023-09-30, suggesting good profitability prospects. The company has reported a net profit in 9 out of the past 10 years.
Growth Metrics: The Future Outlook
To ensure the sustainability of dividends, a company must have robust growth metrics. Brookfield Corp's growth rank of 8 out of 10 suggests that the company's growth trajectory is good relative to its competitors.
Revenue is the lifeblood of any company, and Brookfield Corp's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Brookfield Corp's revenue has increased by approximately 9.30% per year on average, a rate that outperforms approximately 56.18% 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, Brookfield Corp's earnings increased by approximately -5.00% per year on average, a rate that outperforms approximately 34.75% of global competitors.
Lastly, the company's 5-year EBITDA growth rate of -21.70%, which outperforms approximately 5.87% of global competitors.
Engaging Conclusion: A Forward-Looking Perspective on Brookfield Corp's Dividends
Considering Brookfield Corp's consistent history of dividend payments, its status as a dividend achiever, and its growth prospects, the company presents an interesting case for value investors. While the current dividend yield is near a 10-year low and the forward yield suggests a potential decrease, the growth rates and profitability rank indicate a company with a solid foundation. Investors must weigh these factors, along with the payout ratio and overall financial health, to determine if Brookfield Corp aligns with their investment strategy. Will Brookfield Corp continue its dividend achiever streak, or will economic headwinds challenge this status? For investors seeking high-dividend yield stocks, GuruFocus Premium offers a High Dividend Yield Screener to discover opportunities that align with their portfolio goals.
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.
