An In-Depth Look at the Upcoming Dividend Payment and Historical Performance
Qualcomm Inc (QCOM, Financial) recently announced a dividend of $0.8 per share, payable on 2023-12-14, with the ex-dividend date set for 2023-11-29. 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 Qualcomm Inc's dividend performance and assess its sustainability.
What Does Qualcomm Inc Do?
Qualcomm develops and licenses wireless technology and designs chips for smartphones. The company's key patents revolve around CDMA and OFDMA technologies, which are standards in wireless communications that are the backbone of all 3G, 4G, and 5G networks. Qualcomm's IP is licensed by virtually all wireless device makers. The firm is also the world's largest wireless chip vendor, supplying nearly every premier handset maker with leading-edge processors. Qualcomm also sells RF-front end modules into smartphones, as well as chips into automotive and Internet of Things markets.
A Glimpse at Qualcomm Inc's Dividend History
Qualcomm Inc has maintained a consistent dividend payment record since 2003, distributing dividends on a quarterly basis. The stock is recognized as a dividend achiever, a prestigious title awarded to companies that have increased their dividend annually for at least the past 20 years. Below is a chart showing annual Dividends Per Share to track historical trends.
Breaking Down Qualcomm Inc's Dividend Yield and Growth
As of today, Qualcomm Inc currently has a 12-month trailing dividend yield of 2.41% and a 12-month forward dividend yield of 2.48%, indicating an expectation of increased dividend payments over the next 12 months. Over the past three years, Qualcomm Inc's annual dividend growth rate was 6.90%, which decreased to 5.30% per year over a five-year horizon. Over the past decade, the annual dividends per share growth rate stands at 8.50%. Based on Qualcomm Inc's dividend yield and five-year growth rate, the 5-year yield on cost of Qualcomm Inc stock as of today is approximately 3.12%.
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, ensuring funds are available for future growth and unexpected downturns. As of 2023-09-30, Qualcomm Inc's dividend payout ratio is 0.48. Qualcomm Inc's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Qualcomm Inc's profitability 9 out of 10 as of 2023-09-30, suggesting good profitability prospects. The company has reported net profit in 9 out of the past 10 years.
Growth Metrics: The Future Outlook
To ensure the sustainability of dividends, a company must have robust growth metrics. Qualcomm Inc's growth rank of 9 out of 10 suggests that the company's growth trajectory is good relative to its competitors. Qualcomm Inc's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model, with an average increase of approximately 15.80% per year, outperforming about 59.86% 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, with an average increase of approximately 12.50% per year, outperforming about 33.48% of global competitors.
Conclusion: Qualcomm Inc's Dividend Outlook
Considering Qualcomm Inc's solid track record of dividend payments, consistent growth in dividend per share, and a prudent payout ratio, the company stands as a compelling choice for investors seeking stable dividend income. The robust profitability rank and favorable growth metrics further cement the company's ability to sustain and potentially increase its dividends in the future. As value investors evaluate the prospects of Qualcomm Inc, they can also utilize tools like the High Dividend Yield Screener available to GuruFocus Premium users to identify similar high-dividend yield opportunities.
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.
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