Exploring Cia Energetica DE Minas Gerais - Cemig's Dividend Performance and Sustainability
Cia Energetica DE Minas Gerais - Cemig (CIG, Financial) recently announced a dividend of $0.04 per share, payable on an unannounced date, with the ex-dividend date set for 2023-09-29. As investors anticipate this upcoming payment, the spotlight also shines on the company's dividend history, yield, and growth rates. Using data from GuruFocus, this article delves into Cia Energetica DE Minas Gerais - Cemig's dividend performance and evaluates its sustainability.
About Cia Energetica DE Minas Gerais - Cemig
Cia Energetica DE Minas Gerais - Cemig, formerly known as Energy Company of Minas Gerais, is a Brazilian power company that generates, transmits, and distributes electricity. As one of the largest power companies in Brazil, it operates across most Brazilian states and in Chile. The company has various subsidiaries and chiefly operates through its generation, transmission, distribution, and gas segments. The majority of its revenue is derived from electricity sales to consumers. The company primarily generates power through hydroelectric resources, and secondarily through thermal and wind resources.
Cia Energetica DE Minas Gerais - Cemig's Dividend Record
Cia Energetica DE Minas Gerais - Cemig has maintained a consistent dividend payment record since 2002, with dividends currently distributed on a quarterly basis. The chart below shows annual Dividends Per Share for tracking historical trends.
Understanding Cia Energetica DE Minas Gerais - Cemig's Dividend Yield and Growth
As of today, Cia Energetica DE Minas Gerais - Cemig has a 12-month trailing dividend yield of 5.99% and a 12-month forward dividend yield of 5.65%, indicating an expectation of decreased dividend payments over the next 12 months.
Over the past three years, Cia Energetica DE Minas Gerais - Cemig's annual dividend growth rate was 74.60%. Extended to a five-year horizon, this rate increased to 94.30% per year. Over the past decade, Cia Energetica DE Minas Gerais - Cemig's annual dividends per share growth rate stands at 6.40%.
Based on Cia Energetica DE Minas Gerais - Cemig's dividend yield and five-year growth rate, the 5-year yield on cost of Cia Energetica DE Minas Gerais - Cemig stock as of today is approximately 165.88%.
Assessing Dividend Sustainability: 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 2023-06-30, Cia Energetica DE Minas Gerais - Cemig's dividend payout ratio is 0.49.
Cia Energetica DE Minas Gerais - Cemig's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Cia Energetica DE Minas Gerais - Cemig's profitability 8 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.
Growth Metrics: The Future Outlook
To ensure the sustainability of dividends, a company must have robust growth metrics. Cia Energetica DE Minas Gerais - Cemig'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 Cia Energetica DE Minas Gerais - Cemig's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Cia Energetica DE Minas Gerais - Cemig's revenue has increased by approximately 10.60% per year on average, a rate that outperforms approximately 62.14% 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, Cia Energetica DE Minas Gerais - Cemig's earnings increased by approximately 11.30% per year on average, a rate that outperforms approximately 63.72% of global competitors.
Lastly, the company's 5-year EBITDA growth rate of 46.50% outperforms approximately 96.17% of global competitors.
Looking Forward
Given Cia Energetica DE Minas Gerais - Cemig's consistent dividend payments, impressive growth rate, reasonable payout ratio, high profitability, and robust growth metrics, it appears poised to sustain its dividends in the future. However, like all investments, it's essential for investors to conduct their due diligence and consider their financial goals and risk tolerance before investing.
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