Insights into Exelon Corp's Upcoming Dividend and Historical Performance
Exelon Corp (EXC, Financial) recently announced a dividend of $0.38 per share, payable on 2024-03-15, with the ex-dividend date set for 2024-03-01. 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 Exelon Corp's dividend performance and assess its sustainability.
What Does Exelon Corp Do?
Exelon Corp serves approximately 10 million power and gas customers at its six regulated utilities in Illinois, Pennsylvania, Maryland, New Jersey, Delaware, and Washington, D.C. The company plays a significant role in the utilities sector, providing essential services to a vast customer base across various states.
A Glimpse at Exelon Corp's Dividend History
Exelon Corp has maintained a consistent dividend payment record since 1986, showcasing its commitment to returning value to shareholders. Dividends are currently distributed on a quarterly basis, providing investors with a regular income stream. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Exelon Corp's Dividend Yield and Growth
As of today, Exelon Corp currently has a 12-month trailing dividend yield of 4.04% and a 12-month forward dividend yield of 4.26%. This suggests an expectation of increased dividend payments over the next 12 months.
Over the past three years, Exelon Corp's annual dividend growth rate was -2.00%. And over the past decade, Exelon Corp's annual dividends per share growth rate stands at 1.30%. Based on Exelon Corp's dividend yield and five-year growth rate, the 5-year yield on cost of Exelon Corp stock as of today is approximately 4.04%.
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 2023-12-31, Exelon Corp's dividend payout ratio is 0.62.
Exelon Corp's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Exelon Corp's profitability 7 out of 10 as of 2023-12-31, suggesting good profitability prospects. The company has reported positive net income for each of the years over the past decade, further solidifying its high profitability.
Growth Metrics: The Future Outlook
To ensure the sustainability of dividends, a company must have robust growth metrics. Exelon Corp's growth rank of 7 out of 10 suggests that the company's growth trajectory is good relative to its competitors. However, Exelon Corp's revenue has decreased by approximately -13.60% per year on average, a rate that underperforms approximately 96.3% 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, Exelon Corp's earnings decreased by approximately -10.20% per year on average, a rate that underperforms approximately 74.6% of global competitors. Additionally, the company's 5-year EBITDA growth rate of -1.40%, which underperforms approximately 70.62% of global competitors, raises concerns about its long-term growth prospects.
Next Steps
In conclusion, while Exelon Corp's dividend yield is attractive, the negative growth rates in revenue, earnings, and EBITDA point towards potential challenges in maintaining dividend growth over the long term. The dividend payout ratio remains moderate, suggesting that payments are currently sustainable, but investors should be mindful of the company's ability to reverse the downward trend in its growth metrics. The profitability rank does provide some reassurance regarding Exelon Corp's competitive position. However, meticulous monitoring of the company's financial health and market conditions is advisable for those considering Exelon Corp as a part of their dividend portfolio. Value investors seeking to maximize their income streams can explore further with GuruFocus Premium's High Dividend Yield Screener for other high-yielding investment opportunities.
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.
