Exploring the Dividend Sustainability and Growth of Uni-President China Holdings Ltd (UPCHY, Financial)
Introduction to Uni-President China Holdings Ltd's Dividend
Uni-President China Holdings Ltd (UPCHY) recently announced a dividend of $5.92 per share, payable on 2024-07-05, with the ex-dividend date set for 2024-06-05. 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 Uni-President China Holdings Ltd's dividend performance and assess its sustainability.
What Does Uni-President China Holdings Ltd Do?
Uni-President China is a leading instant food and beverage producer in mainland China. Its major products include RTD tea, coffee, juice, and instant food such as instant noodles and self-heating packaged food. It is majority-owned by parent company Uni-President Enterprises Corporation, a leading food conglomerate in Taiwan.
A Glimpse at Uni-President China Holdings Ltd's Dividend History
Uni-President China Holdings Ltd has maintained a consistent dividend payment record since 2014. Dividends are currently distributed on a yearly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Uni-President China Holdings Ltd's Dividend Yield and Growth
As of today, Uni-President China Holdings Ltd currently has a 12-month trailing dividend yield of 5.56% and a 12-month forward dividend yield of 6.86%. This suggests an expectation of increased dividend payments over the next 12 months. Over the past three years, Uni-President China Holdings Ltd's annual dividend growth rate was -0.50%. Extended to a five-year horizon, this rate increased to 18.60% per year. And over the past decade, Uni-President China Holdings Ltd's annual dividends per share growth rate stands at an impressive 36.00%.
Based on Uni-President China Holdings Ltd's dividend yield and five-year growth rate, the 5-year yield on cost of Uni-President China Holdings Ltd stock as of today is approximately 13.05%.
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, Uni-President China Holdings Ltd's dividend payout ratio is 0.88, which may suggest that the company's dividend may not be sustainable.
Uni-President China Holdings Ltd's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Uni-President China Holdings Ltd'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 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. Uni-President China Holdings Ltd's growth rank of 7 out of 10 suggests that the company's growth trajectory is good relative to its competitors. Revenue is the lifeblood of any company, and Uni-President China Holdings Ltd's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Uni-President China Holdings Ltd's revenue has increased by approximately 5.00% per year on average, a rate that underperforms than approximately 66.35% 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, Uni-President China Holdings Ltd's earnings increased by approximately -6.60% per year on average, a rate that underperforms than approximately 79.12% of global competitors.
Lastly, the company's 5-year EBITDA growth rate of 2.10%, which underperforms than approximately 65.67% of global competitors.
Conclusion
Given Uni-President China Holdings Ltd's strong dividend history and potential for future growth, investors might consider this stock a viable option for their portfolios. However, the sustainability of its dividends, given the payout ratio and mixed growth metrics, remains a critical factor to watch. For those interested in exploring further, GuruFocus Premium users can screen for high-dividend yield stocks using 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.
