Assessing the Upcoming Dividend and the Company's Dividend Track Record
Utz Brands Inc (UTZ, Financial) recently announced a dividend of $0.06 per share, payable on 2024-01-04, with the ex-dividend date set for 2023-12-15. 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 Utz Brands Inc's dividend performance and assess its sustainability.
What Does Utz Brands Inc Do?
Utz Brands Inc is a snack food manufacturing company. It manufactures a diverse portfolio of salty snacks under popular brands including Utz, Zapp's, Golden Flake, Good Health, Boulder Canyon, Hawaiian, TORTIYAHS!, among others. The company's products include potato chips, pretzels, cheese snacks, pork skins, pub/party mixes, and veggie snacks. Its products are distributed nationally and internationally through grocery, mass merchant, club, convenience, drug, and other channels. It operates in the given segment: the manufacturing, distribution, marketing and sale of snack food products.
A Glimpse at Utz Brands Inc's Dividend History
Utz Brands Inc has maintained a consistent dividend payment record since 2020. Dividends are currently distributed on a quarterly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Utz Brands Inc's Dividend Yield and Growth
As of today, Utz Brands Inc currently has a 12-month trailing dividend yield of 1.60% and a 12-month forward dividend yield of 1.60%. This suggests an expectation of same dividend payments over the next 12 months.
Based on Utz Brands Inc's dividend yield and five-year growth rate, the 5-year yield on cost of Utz Brands Inc stock as of today is approximately 1.60%.
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 2023-09-30, Utz Brands Inc's dividend payout ratio is 1.06, which may suggest that the company's dividend may not be sustainable.
Utz Brands Inc's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Utz Brands Inc's profitability 3 out of 10 as of 2023-09-30, 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. Utz Brands Inc's growth rank of 3 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 Utz Brands Inc's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Utz Brands Inc's revenue has increased by approximately 8.50% per year on average, a rate that outperforms approximately 55.97% 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, Utz Brands Inc's earnings increased by approximately 62.80% per year on average, a rate that outperforms approximately 88.64% of global competitors.
Concluding Thoughts on Utz Brands Inc's Dividend Prospects
While Utz Brands Inc's dividend yield and recent growth in earnings per share are promising, the sustainability of its dividends remains a concern due to the low profitability rank and high payout ratio. Investors should consider these factors in conjunction with the company's performance and industry trends when evaluating Utz Brands Inc as a potential investment for dividend income. As always, it is crucial to conduct thorough research and consider a diversified investment approach. For those seeking high-dividend yield opportunities, GuruFocus Premium offers a comprehensive High Dividend Yield Screener to aid in the search for promising dividend-paying stocks.
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.
