Assessing the Upcoming Dividend and Historical Performance
Clicks Group Ltd (CLCGY, Financial) recently announced a dividend of $0.53 per share, payable on 2024-02-05, with the ex-dividend date set for 2024-01-25. 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 Clicks Group Ltd's dividend performance and assess its sustainability.
What Does Clicks Group Ltd Do?
Clicks Group Ltd operates pharmaceutical health and beauty retail stores. The company primarily operates a retail pharmacy chain in South Africa, with a limited number of operations in bordering countries. The company targets middle- to upper-income consumers. Clicks' business strategy focuses on consistent product sourcing, product development, and measured store expansion. The company has a portfolio of retail franchise brands including The Body Shop, GNC, and claire's. Clicks uses United Pharmaceutical Distributors' capabilities for the groups' integrated channel to the healthcare market.
A Glimpse at Clicks Group Ltd's Dividend History
Clicks Group Ltd has maintained a consistent dividend payment record since 2013. Dividends are currently distributed on a bi-annual basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Clicks Group Ltd's Dividend Yield and Growth
As of today, Clicks Group Ltd currently has a 12-month trailing dividend yield of 2.30% and a 12-month forward dividend yield of 2.31%. This suggests an expectation of increased dividend payments over the next 12 months.
Over the past three years, Clicks Group Ltd's annual dividend growth rate was 25.20%. Extended to a five-year horizon, this rate decreased to 14.30% per year. And over the past decade, Clicks Group Ltd's annual dividends per share growth rate stands at an impressive 15.30%.
Based on Clicks Group Ltd's dividend yield and five-year growth rate, the 5-year yield on cost of Clicks Group Ltd stock as of today is approximately 4.49%.
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 2023-08-31, Clicks Group Ltd's dividend payout ratio is 0.62.
Clicks Group Ltd's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Clicks Group Ltd's profitability 9 out of 10 as of 2023-08-31, 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. Clicks Group Ltd'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 Clicks Group Ltd's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Clicks Group Ltd's revenue has increased by approximately 8.10% per year on average, which underperforms approximately 52.34% 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, Clicks Group Ltd's earnings increased by approximately 11.50% per year on average, which underperforms approximately 45.15% of global competitors.
Lastly, the company's 5-year EBITDA growth rate of 13.40%, which underperforms approximately 43.88% of global competitors.
Next Steps
In conclusion, Clicks Group Ltd's upcoming dividend payment, along with its history of consistent dividend growth, presents an attractive proposition for income-focused investors. The company's prudent payout ratio and strong profitability rank underscore the sustainability of its dividend payments. However, investors should also consider the growth metrics, which reveal a mixed performance relative to global competitors. With these factors in mind, value investors are encouraged to weigh the potential for continued dividend growth against the broader financial health and market position of Clicks Group Ltd.
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.
