An In-Depth Look at Henkel AG & Co KGaA's Upcoming Dividend and Its Sustainability
Henkel AG & Co KGaA (HENOY, Financial) recently announced a dividend of $0.5 per share, payable on 2024-05-06, with the ex-dividend date set for 2024-04-23. 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 Henkel AG & Co KGaA's dividend performance and assess its sustainability.
What Does Henkel AG & Co KGaA Do?
Henkel AG & Co KGaA operates in two primary sectors catering to distinct customer groups. The consumer segment, which accounts for roughly half of the company's consolidated 2022 sales, includes well-known laundry and home care brands like Persil and Purex, as well as beauty care products under brands such as Schwarzkopf and Dial. The other half of sales comes from the adhesives technologies segment. Geographically, Europe is Henkel's largest market, representing 42% of consolidated sales in 2022, followed by North America at 27%, and Asia-Pacific at 17%.
A Glimpse at Henkel AG & Co KGaA's Dividend History
Henkel AG & Co KGaA has upheld a consistent dividend payment track record since 2010, with dividends being distributed annually. The following chart provides a visual representation of the annual Dividends Per Share for tracking historical trends.
Breaking Down Henkel AG & Co KGaA's Dividend Yield and Growth
Henkel AG & Co KGaA currently boasts a 12-month trailing dividend yield of 2.66% and a 12-month forward dividend yield of 2.60%. This slight discrepancy indicates an expectation of slightly decreased dividend payments in the coming year. Over the last five years, the dividend growth rate was a modest 0.50% per year, while the ten-year annual dividends per share growth rate was more robust at 6.20%. Henkel AG & Co KGaA's 5-year yield on cost is approximately 2.73% as of today.
The Sustainability Question: Payout Ratio and Profitability
The sustainability of Henkel AG & Co KGaA's dividends can be partially determined by looking at the dividend payout ratio, which is currently at 0.42. This indicates that the company is distributing less than half of its earnings as dividends, retaining sufficient funds for growth and stability. Henkel AG & Co KGaA's profitability rank is a solid 7 out of 10, reflecting good profitability prospects. The company's consistent positive net income over the past decade reinforces its financial strength.
Growth Metrics: The Future Outlook
Henkel AG & Co KGaA's growth rank stands at 7 out of 10, indicating a favorable growth trajectory compared to its competitors. However, the company's revenue and earnings growth rates suggest there may be challenges ahead. Henkel AG & Co KGaA's revenue has been increasing at an average rate of 4.80% per year, which is slower than 59.28% of global competitors. Its 3-year EPS growth rate of 0.90% per year also lags behind approximately 58.5% of global competitors. Furthermore, its 5-year EBITDA growth rate of -6.90% is lower than 77.37% of global competitors, highlighting areas where Henkel AG & Co KGaA may need to focus its strategic efforts.
Concluding Thoughts on Henkel AG & Co KGaA's Dividend Outlook
Considering Henkel AG & Co KGaA's solid dividend history, reasonable payout ratio, and good profitability rank, the company's dividends appear sustainable in the short term. However, the growth metrics indicate that for long-term sustainability, Henkel AG & Co KGaA may need to address its slower growth rates and seek opportunities to enhance its competitive edge. Investors considering Henkel AG & Co KGaA for its dividend potential should also weigh these factors in their decision-making process. For those seeking additional high-dividend yield opportunities, GuruFocus Premium offers a High Dividend Yield Screener to discover other promising investments.
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.
