An In-Depth Look at Mondi PLC's Upcoming Dividend and Its Sustainability
Mondi PLC (MONDY, Financial) recently announced a dividend of $1.02 per share, payable on 2024-05-29, with the ex-dividend date set for 2024-04-04. 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 Mondi PLC's dividend performance and assess its sustainability.
What Does Mondi PLC Do?
Mondi PLC specializes in packaging and paper products, with a significant presence in Europe. The company operates through various segments, notably Corrugated Packaging and Flexible Packaging, with the latter being the most lucrative in terms of revenue. Mondi PLC's diverse product offerings include kraft paper, paper bags, consumer flexibles, and pulp, which cater to a wide range of industries and uses.
A Glimpse at Mondi PLC's Dividend History
Mondi PLC has upheld a reliable track record of dividend payments since 2014, with distributions occurring bi-annually. This consistency is a positive signal for investors seeking regular income streams from their investments.
Below is a chart showing annual Dividends Per Share to track historical trends.
Breaking Down Mondi PLC's Dividend Yield and Growth
As of today, Mondi PLC's trailing dividend yield stands at 4.95%, with a forward dividend yield of 4.49%, indicating a potential decrease in dividend payments over the next year. The dividend growth rate over the past three years was 10.60%, which slowed to -0.30% over a five-year period. However, looking at the past decade, the annual dividends per share growth rate is a robust 8.40%.
Considering Mondi PLC's dividend yield and five-year growth rate, the 5-year yield on cost for Mondi PLC stock is approximately 4.88%.
The Sustainability Question: Payout Ratio and Profitability
To gauge the longevity of Mondi PLC's dividends, one must examine the dividend payout ratio. Currently, Mondi PLC has a payout ratio of 0.49, which suggests a balance between distributing earnings to shareholders and retaining funds for future growth. Additionally, Mondi PLC's profitability rank of 7 out of 10, as of 2023-12-31, underscores its ability to generate profits in comparison to its peers. The company has reported net profit in 9 out of the past 10 years, reinforcing its financial stability.
Growth Metrics: The Future Outlook
Mondi PLC's growth rank of 7 out of 10 indicates a favorable growth trajectory. Despite a revenue increase of approximately 1.50% per year on average, which underperforms about 72.73% of global competitors, the company's 3-year EPS growth rate of 2.30% per year suggests a capacity for earnings growth. However, Mondi PLC's 5-year EBITDA growth rate of -0.80% lags behind approximately 67.67% of global competitors, signaling areas for potential improvement.
Next Steps
In conclusion, Mondi PLC's forthcoming dividend payment, historical dividend growth, and current payout ratio demonstrate a commitment to shareholder returns. The company's solid profitability rank and growth metrics further support the potential sustainability of its dividends. However, investors should also consider the slower revenue and EBITDA growth rates as they reflect on Mondi PLC's long-term prospects. As value investors navigate the complexities of dividend investing, they may find additional insights by using tools like the High Dividend Yield Screener available to GuruFocus Premium users.
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.
