Exploring the Sustainability and Growth of Oshkosh Corp's Dividends
Oshkosh Corp (OSK, Financial) recently announced a dividend of $0.46 per share, payable on 2024-05-28, with the ex-dividend date set for 2024-05-10. 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 Oshkosh Corp's dividend performance and assess its sustainability.
What Does Oshkosh Corp Do?
Oshkosh Corp is the top producer of access equipment, specialty vehicles, and military trucks. It serves diverse end markets, where it is typically the market share leader in North America, or, in the case of JLG aerial work platforms, a global leader. The company had manufactured joint light tactical vehicles for the US Department of Defense. However, Oshkosh recently lost the JLTV recompete, bringing into focus its US Postal Service contract, which calls for the electrification of US postal vehicles. The company reports in three segments—access equipment (52% of revenue), defense (22%), and vocational (27%)—and generated $9.6 billion in revenue in 2023.
A Glimpse at Oshkosh Corp's Dividend History
Oshkosh Corp has maintained a consistent dividend payment record since 2013. Dividends are currently distributed on a quarterly basis. Oshkosh Corp has increased its dividend each year since 2014. The stock is thus listed as a dividend achiever, an honor that is given to companies that have increased their dividend each year for at least the past 10 years. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Oshkosh Corp's Dividend Yield and Growth
As of today, Oshkosh Corp currently has a 12-month trailing dividend yield of 1.45% and a 12-month forward dividend yield of 1.57%. This suggests an expectation of increased dividend payments over the next 12 months. Over the past three years, Oshkosh Corp's annual dividend growth rate was 11.00%. Extended to a five-year horizon, this rate increased to 11.20% per year. Based on Oshkosh Corp's dividend yield and five-year growth rate, the 5-year yield on cost of Oshkosh Corp stock as of today is approximately 2.47%.
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 2024-03-31, Oshkosh Corp's dividend payout ratio is 0.16. Oshkosh Corp's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Oshkosh Corp's profitability 7 out of 10 as of 2024-03-31, suggesting good profitability prospects. The company has reported positive net income for each of the 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. Oshkosh Corp's growth rank of 7 out of 10 suggests that the company's growth trajectory is good relative to its competitors. Revenue is the lifeblood of any company, and Oshkosh Corp's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Oshkosh Corp's revenue has increased by approximately 13.70% per year on average, a rate that outperforms approximately 63.73% 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, Oshkosh Corp's earnings increased by approximately 28.80% per year on average, a rate that outperforms approximately 62.11% of global competitors. Lastly, the company's 5-year EBITDA growth rate of -1.60%, which outperforms approximately 33.9% of global competitors.
Conclusion: A Robust Dividend Profile
Oshkosh Corp's consistent dividend payments, impressive growth rate, and strong payout ratio underscore its robust dividend profile. Combined with solid profitability and growth metrics, these factors make Oshkosh Corp a compelling case for investors seeking reliable dividend income. As the company navigates future challenges and opportunities, it remains well-positioned to continue its tradition of rewarding shareholders. Interested in finding more high-dividend yield stocks? GuruFocus Premium users can explore further 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.
