Exploring the Sustainability and Growth of RGA's Dividends
Reinsurance Group of America Inc (RGA, Financial) recently announced a dividend of $0.85 per share, payable on May 28, 2024, with the ex-dividend date set for May 13, 2024. As investors anticipate this upcoming payment, it's crucial to delve into the company's dividend history, yield, and growth rates. This analysis utilizes data from GuruFocus to evaluate the performance and sustainability of Reinsurance Group of America Inc's dividends.
What Does Reinsurance Group of America Inc Do?
Reinsurance Group of America Inc is a prominent insurance holding company operating across diverse regions including the United States, Latin America, Canada, Europe, Africa, Asia, and Australia. The company offers a broad range of products and services such as life reinsurance, living benefits reinsurance, group reinsurance, health reinsurance, financial solutions, facultative underwriting, and product development. Its business is segmented into traditional and financial solution divisions.
A Glimpse at Reinsurance Group of America Inc's Dividend History
Since 2006, Reinsurance Group of America Inc has maintained a consistent dividend payment track record, with distributions occurring quarterly. The company has also increased its dividends annually since 2006, earning it the status of a dividend achiever— a distinction awarded to companies that have consistently raised their dividends for at least 18 years.
Below is a chart illustrating the annual Dividends Per Share to track historical trends.
Breaking Down Reinsurance Group of America Inc's Dividend Yield and Growth
Currently, Reinsurance Group of America Inc boasts a 12-month trailing dividend yield of 1.60% and a forward dividend yield of 1.63%, indicating anticipated dividend increases over the next year. Over the past three years, the company's annual dividend growth rate was 5.60%, which escalated to 7.50% over a five-year period, and an impressive 12.40% over the past decade.
Based on these metrics, the 5-year yield on cost for Reinsurance Group of America Inc's stock is approximately 2.30% as of today.
The Sustainability Question: Payout Ratio and Profitability
The sustainability of dividends is often gauged by the dividend payout ratio, which for Reinsurance Group of America Inc stands at 0.20 as of March 31, 2024. This low ratio indicates that the company retains a substantial portion of its earnings, bolstering funds for future growth and stability. Additionally, the company's profitability rank is 7 out of 10, reflecting strong earnings capabilities relative to its peers. Consistent positive net income over the past decade further reinforces its robust profitability profile.
Growth Metrics: The Future Outlook
Reinsurance Group of America Inc's growth rank of 7 suggests a favorable growth trajectory. The company's revenue per share and 3-year revenue growth rate of 7.30% annually outperforms approximately 50.32% of global competitors. Its 3-year EPS growth rate of 46.60% annually surpasses about 83.62% of global competitors, and the 5-year EBITDA growth rate of 6.60% also indicates strong performance.
Conclusion
Considering Reinsurance Group of America Inc's consistent dividend increases, low payout ratio, solid profitability, and strong growth metrics, the company's dividend payments appear sustainable and poised for future growth. Investors seeking to explore more high-dividend yield opportunities can utilize the High Dividend Yield Screener available to GuruFocus Premium users.
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.
