Exploring the Sustainability and Growth of ANZ Group Holdings Ltd's Dividends
ANZ Group Holdings Ltd (ANZGY, Financial) recently announced a dividend of $0.55 per share, which is scheduled to be paid on 2024-07-11, with the ex-dividend date set for 2024-05-17. As investors anticipate this upcoming payment, it's crucial to examine the company's dividend history, yield, and growth rates. Utilizing data from GuruFocus, this analysis delves into the dividend performance of ANZ Group Holdings Ltd and evaluates its sustainability.
What Does ANZ Group Holdings Ltd Do?
ANZ Group Holdings Ltd operates as one of Australia's four major banks, offering retail, business, and institutional banking services primarily in Australia, New Zealand, and across the Asia-Pacific region. While the bank has scaled back its super-regional Asian strategy, it continues to maintain a presence in Asia, focusing instead on higher-returning businesses in Australia and New Zealand. This strategic shift has resulted in a more balanced, well-capitalized, and simplified banking operation.
A Glimpse at ANZ Group Holdings Ltd's Dividend History
Since 1992, ANZ Group Holdings Ltd has consistently paid dividends, with payments made bi-annually. Below is a chart illustrating the annual Dividends Per Share to track historical trends.
Breaking Down ANZ Group Holdings Ltd's Dividend Yield and Growth
ANZ Group Holdings Ltd currently boasts a trailing dividend yield of 6.17% and a forward dividend yield of 6.20%, indicating an anticipated increase in dividend payments over the next year. Over the past three years, the annual dividend growth rate was an impressive 14.20%. However, this growth rate dipped to -1.20% over a five-year period and further declined to -2.90% over the last decade. As of today, the 5-year yield on cost for ANZ Group Holdings Ltd stock is approximately 5.81%.
The Sustainability Question: Payout Ratio and Profitability
To evaluate the sustainability of the dividend, one must consider the company's payout ratio. ANZ Group Holdings Ltd's dividend payout ratio is currently 0.77, suggesting a moderate portion of earnings is returned to shareholders, which could impact the sustainability of future dividends. Additionally, the company's profitability rank is 4 out of 10, indicating challenges in maintaining strong earnings relative to its peers, despite reporting positive net income consistently over the past decade.
Growth Metrics: The Future Outlook
The sustainability of dividends is heavily dependent on robust growth metrics. ANZ Group Holdings Ltd's growth rank stands at 4 out of 10, hinting at poor growth prospects. Despite a 3-year revenue growth rate of 2.70% per year, the company's revenue performance is weaker compared to 70.68% of global competitors. Furthermore, the 3-year EPS growth rate of 17.40% per year and a 5-year EBITDA growth rate of 2.20% also lag behind many global competitors.
Conclusion: Evaluating the Dividend Strategy
While ANZ Group Holdings Ltd has demonstrated a commitment to returning value to shareholders through dividends, the sustainability of these payments is under scrutiny due to mixed growth metrics and profitability challenges. Investors should closely monitor the company's financial health and strategic adjustments. For those seeking high-dividend yield stocks, consider utilizing 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.
