Assessing the Upcoming Dividend and Historical Performance
Spirax-Sarco Engineering PLC (SPXSY, Financial) recently announced a dividend of $0.72 per share, payable on 2024-06-10, with the ex-dividend date set for 2024-04-25. 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 Spirax-Sarco Engineering PLCs dividend performance and assess its sustainability.
What Does Spirax-Sarco Engineering PLC Do?
Spirax-Sarco is a global manufacturer of a wide range of applications for industrial and commercial steam systems, electric thermal solutions and peristaltic pumps used across multiple industries. The group operates across three segments and has over 110,000 direct customers across 130 countries. Approximately 85% of group sales are generated from recurring maintenance and small improvements to existing customer systems. Spirax-Sarco has 1,700 product lines and 2,100 sales and service engineers, who account for 25% of employees.
A Glimpse at Spirax-Sarco Engineering PLC's Dividend History
Spirax-Sarco Engineering PLC has maintained a consistent dividend payment record since 2016. Dividends are currently distributed on a bi-annually basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Spirax-Sarco Engineering PLC's Dividend Yield and Growth
As of today, Spirax-Sarco Engineering PLC currently has a 12-month trailing dividend yield of 1.68% and a 12-month forward dividend yield of 1.75%. This suggests an expectation of increased dividend payments over the next 12 months. Over the past three years, Spirax-Sarco Engineering PLC's annual dividend growth rate was 11.70%. Extended to a five-year horizon, this rate decreased to 11.10% per year. And over the past decade, Spirax-Sarco Engineering PLC's annual dividends per share growth rate stands at an impressive 10.60%.
Based on Spirax-Sarco Engineering PLC's dividend yield and five-year growth rate, the 5-year yield on cost of Spirax-Sarco Engineering PLC stock as of today is approximately 2.84%.
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, Spirax-Sarco Engineering PLC's dividend payout ratio is 0.49.
Spirax-Sarco Engineering PLC's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Spirax-Sarco Engineering PLC's profitability 9 out of 10 as of 2023-12-31, suggesting good profitability prospects. The company has reported positive net income for each 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. Spirax-Sarco Engineering PLC's growth rank of 9 out of 10 suggests that the company's growth trajectory is strong relative to its competitors.
Revenue is the lifeblood of any company, and Spirax-Sarco Engineering PLC's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Spirax-Sarco Engineering PLC's revenue has increased by approximately 12.20% per year on average, a rate that outperforms approximately 63.6% 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, Spirax-Sarco Engineering PLC's earnings increased by approximately 6.80% per year on average, a rate that outperforms approximately 43.19% of global competitors.
Lastly, the company's 5-year EBITDA growth rate of 7.30%, which outperforms approximately 47.59% of global competitors, further underscores its strong financial health.
Concluding Thoughts on Spirax-Sarco Engineering PLC's Dividend Fortitude
In conclusion, Spirax-Sarco Engineering PLC's upcoming dividend payment, consistent historical distribution, and robust growth metrics paint a picture of a company with a strong commitment to shareholder returns. The impressive dividend growth rates, combined with a prudent payout ratio and high profitability, suggest that the dividends are not only sustainable but also have the potential for future growth. Investors considering Spirax-Sarco Engineering PLC for its dividend prospects may find reassurance in these financial indicators. As the company continues to navigate the dynamic industrial landscape, its ability to maintain and potentially increase its dividends could be a testament to its resilience and strategic acumen.
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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.
