Examining the Dividend Performance, Sustainability, and Future Prospects of Everest Group Ltd (EG, Financial)
Everest Group Ltd(EG) recently announced a dividend of $1.75 per share, payable on 2023-09-29, with the ex-dividend date set for 2023-09-18. 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 deep dive into Everest Group Ltd's dividend performance and assess its sustainability.
Everest Group Ltd: An Overview
Everest Group Ltd is engaged in providing insurance services in the U.S., Bermuda, and international markets. It operates in Reinsurance and Insurance business. The Reinsurance operation writes property and casualty reinsurance and specialty lines of business, on both a treaty and facultative basis, through reinsurance brokers, as well as directly with ceding companies. The Insurance operation writes property and casualty insurance directly and through brokers, surplus lines brokers, and general agents within the U.S., Bermuda, Canada, Europe, and South America.
Everest Group Ltd's Dividend History: A Snapshot
Everest Group Ltd has maintained a consistent dividend payment record since 1995. Dividends are currently distributed on a quarterly basis. Everest Group Ltd has increased its dividend each year since 1995. The stock is thus listed as a dividend aristocrat, an honor that is given to companies that have increased their dividend each year for at least the past 28 years.
Understanding Everest Group Ltd's Dividend Yield and Growth
As of today, Everest Group Ltd currently has a 12-month trailing dividend yield of 1.74% and a 12-month forward dividend yield of 1.85%. This suggests an expectation of increase dividend payments over the next 12 months.
Over the past three years, Everest Group Ltd's annual dividend growth rate was 4.20%. Extended to a five-year horizon, this rate increased to 5.30% per year. And over the past decade, Everest Group Ltd's annual dividends per share growth rate stands at an impressive 12.60%.
Based on Everest Group Ltd's dividend yield and five-year growth rate, the 5-year yield on cost of Everest Group Ltd stock as of today is approximately 2.25%.
Evaluating the Sustainability of Everest Group Ltd's Dividend
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 2023-06-30, Everest Group Ltd's dividend payout ratio is 0.22.
Everest Group Ltd's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Everest Group Ltd's profitability 7 out of 10 as of 2023-06-30, suggesting good profitability prospects. The company has reported positive net income for each of year over the past decade, further solidifying its high profitability.
Everest Group Ltd's Growth Metrics: A Look Ahead
To ensure the sustainability of dividends, a company must have robust growth metrics. Everest Group 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 Everest Group Ltd's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Everest Group Ltd's revenue has increased by approximately 15.20% per year on average, a rate that outperforms than approximately 84.28% 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, Everest Group Ltd's earnings increased by approximately -15.00% per year on average, a rate that outperforms than approximately 20.71% of global competitors.
Lastly, the company's 5-year EBITDA growth rate of 29.20%, which outperforms than approximately 89.12% of global competitors.
Conclusion: Everest Group Ltd's Dividend Profile
In conclusion, Everest Group Ltd's consistent dividend payments, impressive dividend growth rate, low payout ratio, high profitability, and robust growth metrics make it an attractive investment for dividend-focused investors. As the company continues to grow and maintain its profitability, the sustainability of its dividends seems assured. However, like all investments, it's essential to do thorough research and consider all factors before making a decision.
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