Exploring the Sustainability and Growth of Dividends
Kuehne + Nagel International AG (KHNGY, Financial) recently announced a dividend of $0.39 per share, payable on 2024-05-31, with the ex-dividend date set for 2024-05-15. 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 Kuehne + Nagel International AG's dividend performance and assess its sustainability.
What Does Kuehne + Nagel International AG Do?
Kuehne + Nagel is a global transportation and logistics company based in Switzerland and founded in 1890. KN is the largest sea freight forwarder globally, and holds the number-two spot in air freight. Sea freight has traditionally constituted the largest part of the business, contributing almost half of group revenue in 2022. The company's goal is to become a more balanced, fully integrated freight forwarder while continually improving its end-to-end offering to its clients.
A Glimpse at Kuehne + Nagel International AG's Dividend History
Kuehne + Nagel International AG has maintained a consistent dividend payment record since 2012. Dividends are currently distributed on a yearly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Kuehne + Nagel International AG's Dividend Yield and Growth
As of today, Kuehne + Nagel International AG currently has a 12-month trailing dividend yield of 5.63% and a 12-month forward dividend yield of 0.69%. This suggests an expectation of decreased dividend payments over the next 12 months. Over the past three years, Kuehne + Nagel International AG's annual dividend growth rate was 51.80%. Extended to a five-year horizon, this rate decreased to 19.00% per year. And over the past decade, Kuehne + Nagel International AG's annual dividends per share growth rate stands at an impressive 10.30%.
Based on Kuehne + Nagel International AG's dividend yield and five-year growth rate, the 5-year yield on cost of Kuehne + Nagel International AG stock as of today is approximately 13.44%.
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 2024-03-31, Kuehne + Nagel International AG's dividend payout ratio is 1.33, which may suggest that the company's dividend may not be sustainable.
Kuehne + Nagel International AG's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Kuehne + Nagel International AG's profitability 8 out of 10 as of 2024-03-31, suggesting good profitability prospects. The company has reported positive net income for each of year 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. Kuehne + Nagel International AG'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 Kuehne + Nagel International AG's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Kuehne + Nagel International AG's revenue has increased by approximately 5.60% per year on average, a rate that underperforms than approximately 58.29% 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, Kuehne + Nagel International AG's earnings increased by approximately 22.80% per year on average, a rate that underperforms than approximately 39.32% of global competitors. Lastly, the company's 5-year EBITDA growth rate of 26.10%, which underperforms than approximately 25% of global competitors.
Next Steps
Considering Kuehne + Nagel International AG's consistent dividend payments, robust dividend growth rate, manageable payout ratio, strong profitability, and solid growth metrics, the company presents a compelling case for investors seeking dividend income. However, the expected decrease in dividend yield suggests a cautious approach. Investors should monitor the company's future earnings reports and any potential market shifts that could impact its financial health. For those looking to expand their portfolio with high-dividend yield stocks, GuruFocus Premium users can utilize the High Dividend Yield Screener to find promising 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.
