Exploring the Dividend Sustainability and Growth Prospects of AB Sagax (SAGXF, Financial)
AB Sagax (SAGXF) recently announced a dividend of $3.1 per share, payable on 2024-05-16, with the ex-dividend date set for 2024-05-10. 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 AB Sagax's dividend performance and assess its sustainability.
What Does AB Sagax Do?
AB Sagax is a property company that invests in commercial properties with a focus on the warehouse and light industry segment. The company owns properties in Sweden, Finland, Germany, and Denmark, with a total rental space of more than 3 million square metres. A significant proportion of the company's real estate portfolio is located in the Stockholm and Helsinki regions. The company's revenue consists primarily of rental income for the provision of premises, of which the majority is derived from the government, municipalities, or companies with significant sales.
A Glimpse at AB Sagax's Dividend History
AB Sagax has maintained a consistent dividend payment record since 2022, with dividends currently distributed on a yearly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down AB Sagax's Dividend Yield and Growth
As of today, AB Sagax currently has a 12-month trailing dividend yield of 1.14% and a 12-month forward dividend yield of 1.30%, suggesting an expectation of increased dividend payments over the next 12 months.
Over the past three years, AB Sagax's annual dividend growth rate was 60.70%. Extended to a five-year horizon, this rate decreased to 28.30% per year, and over the past decade, AB Sagax's annual dividends per share growth rate stands at an impressive 26.30%.
Based on AB Sagax's dividend yield and five-year growth rate, the 5-year yield on cost of AB Sagax stock as of today is approximately 3.96%.
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. As of 2023-12-31, AB Sagax's dividend payout ratio is 2.09, suggesting that the company's dividend may not be sustainable.
AB Sagax's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks AB Sagax's profitability 8 out of 10 as of 2023-12-31, suggesting good profitability prospects. The company has reported net profit in 9 years out of past 10 years.
Growth Metrics: The Future Outlook
To ensure the sustainability of dividends, a company must have robust growth metrics. AB Sagax'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 AB Sagax's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. AB Sagax's revenue has increased by approximately 13.20% per year on average, a rate that outperforms approximately 66.21% 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, AB Sagax's earnings increased by approximately -47.70% per year on average, a rate that outperforms approximately 8.68% of global competitors.
Lastly, the company's 5-year EBITDA growth rate of -15.60%, which outperforms approximately 18.56% of global competitors.
Conclusion: Assessing Dividend Sustainability and Growth Prospects
AB Sagax's impressive history of dividend payments, coupled with its strong growth metrics and profitability, presents a compelling case for investors looking for sustainable income streams. However, the relatively high payout ratio might raise concerns about the long-term sustainability of these dividends. Investors should closely monitor future earnings and payout ratios while considering AB Sagax's strong market position and growth trajectory. For more detailed analyses and to discover other high-dividend yield opportunities, GuruFocus Premium users can utilize 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.
