Unpacking the Dividend Performance and Sustainability of Sirius XM Holdings Inc
Sirius XM Holdings Inc(SIRI, Financial) recently announced a dividend of $0.03 per share, payable on 2023-11-29, with the ex-dividend date set for 2023-11-06. 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 Sirius XM Holdings Inc's dividend performance and assess its sustainability.
What Does Sirius XM Holdings Inc Do?
Sirius XM Holdings is composed of two businesses: SiriusXM and Pandora. SiriusXM transmits music, talk shows, sports, and news via its two satellite radio networks, primarily to consumers in vehicles who pay a subscription fee. The firm's radios come preinstalled on a wide range of light vehicles in the U.S. and Canada. The firm acquired Pandora Media in February 2019 via an all-stock transaction. Pandora is a streaming music platform that offers an ad-supported radio option and a paid on-demand service as well as a robust and growing podcast library. Liberty Media owns 81% of Sirius XM, traded through its Liberty Sirius XM Group tracking stock.
A Glimpse at Sirius XM Holdings Inc's Dividend History
Sirius XM Holdings Inc has maintained a consistent dividend payment record since 2016. Dividends are currently distributed on a quarterly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Sirius XM Holdings Inc's Dividend Yield and Growth
As of today, Sirius XM Holdings Inc currently has a 12-month trailing dividend yield of 1.96% and a 12-month forward dividend yield of 2.15%. This suggests an expectation of increase dividend payments over the next 12 months.
Over the past three years, Sirius XM Holdings Inc's annual dividend growth rate was 21.60%. Extended to a five-year horizon, this rate decreased to 15.90% per year. Based on Sirius XM Holdings Inc's dividend yield and five-year growth rate, the 5-year yield on cost of Sirius XM Holdings Inc stock as of today is approximately 4.10%.
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 2023-09-30, Sirius XM Holdings Inc's dividend payout ratio is 0.30.
Sirius XM Holdings Inc's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Sirius XM Holdings Inc's profitability 9 out of 10 as of 2023-09-30, 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. Sirius XM Holdings Inc's growth rank of 9 out of 10 suggests that the company's growth trajectory is good relative to its competitors.
Revenue is the lifeblood of any company, and Sirius XM Holdings Inc's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Sirius XM Holdings Inc's revenue has increased by approximately 10.20% per year on average, a rate that outperforms than approximately 75.92% 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, Sirius XM Holdings Inc's earnings increased by approximately 13.00% per year on average, a rate that outperforms than approximately 59.72% of global competitors.
Lastly, the company's 5-year EBITDA growth rate of 14.20% outperforms than approximately 69.85% of global competitors.
Conclusion
Considering Sirius XM Holdings Inc's consistent dividend payments, solid growth rate, reasonable payout ratio, high profitability, and strong growth metrics, it appears that the company's dividends are not only sustainable but also likely to grow in the future. The company's robust financial performance and promising outlook make it an attractive option for value investors seeking steady dividend income.
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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.
