A Comprehensive Review of NTIOF's Dividend Profile
National Bank of Canada (NTIOF, Financial) recently announced a dividend of $1.06 per share, payable on 2024-05-01, with the ex-dividend date set for 2024-03-22. 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 National Bank of Canada's dividend performance and assess its sustainability.
What Does National Bank of Canada Do?
The National Bank of Canada is the sixth-largest Canadian bank. The bank offers integrated financial services, primarily in the province of Quebec as well as the city of Toronto. Operational segments include personal and commercial banking, wealth management, and a financial markets group.
A Glimpse at National Bank of Canada's Dividend History
National Bank of Canada has maintained a consistent dividend payment record since 2003. Dividends are currently distributed on a quarterly basis.
The bank has increased its dividend each year since 2003, earning it the status of a dividend achiever, a title reserved for companies that have raised their dividend annually for at least the past 21 years. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down National Bank of Canada's Dividend Yield and Growth
National Bank of Canada currently boasts a 12-month trailing dividend yield of 3.61% and a 12-month forward dividend yield of 3.76%, indicating an anticipated increase in dividend payments over the next year.
Over the past three years, National Bank of Canada's annual dividend growth rate was 11.90%. This rate decreases slightly to 10.00% per year over a five-year span. Over the past decade, the bank's annual dividends per share growth rate stands at 8.00%. Based on these figures, the 5-year yield on cost for National Bank of Canada stock is approximately 5.81%.
The Sustainability Question: Payout Ratio and Profitability
The dividend payout ratio is a key indicator of a dividend's sustainability. National Bank of Canada's dividend payout ratio stands at 0.42 as of 2024-01-31, suggesting a healthy balance between dividend payments and retained earnings for future growth.
The bank's profitability rank is 5 out of 10, indicating fair profitability. Consistent positive net income over the past decade bolsters this assessment, reinforcing the bank's financial stability.
Growth Metrics: The Future Outlook
Robust growth metrics are essential for the sustainability of dividends. National Bank of Canada's growth rank of 5 out of 10 suggests a fair growth outlook. The bank's revenue per share and 3-year revenue growth rate of 8.40% per year outperform approximately 58.63% of global competitors.
The 3-year EPS growth rate of 16.60% per year and the 5-year EBITDA growth rate of 12.20% outperform approximately 60.2% and 65.38% of global competitors, respectively, highlighting the company's earnings growth and operational efficiency.
Next Steps
In conclusion, National Bank of Canada's consistent dividend payments, robust dividend growth rate, prudent payout ratio, and solid profitability and growth metrics make it an attractive prospect for value investors. With a forward-looking approach that takes into account these factors, investors can make informed decisions regarding the sustainability and potential of National Bank of Canada's dividends. For those seeking high-dividend yield opportunities, the High Dividend Yield Screener available to GuruFocus Premium users is an invaluable tool for discovering similar investment prospects.
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.
