Adacel Technologies Ltd (AELTF): A Deep Dive into its Dividend History and Sustainability
An Analysis of Adacel Technologies Ltd's Dividend Performance and Prospects
Adacel Technologies Ltd (AELTF) recently announced a dividend of $0.02 per share, payable on November 21, 2023, with the ex-dividend date set for October 9, 2023. As investors anticipate this upcoming payment, it's crucial to examine the company's dividend history, yield, and growth rates. Using data from GuruFocus, let's delve into Adacel Technologies Ltd's dividend performance and assess its sustainability.
About Adacel Technologies Ltd
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Adacel Technologies Ltd develops and sells simulation and control systems. The company operates in two segments: Systems and Services. The Services segment, which brings in the majority of the revenue, encompasses software maintenance, system support, field services, and on-site technical services. The Systems segment includes operational air traffic management and simulation and training applications. The company primarily generates its revenue from Canada but also has a presence in the USA, Estonia, and Australia.
A Look Back at Adacel Technologies Ltd's Dividend History
Since 2020, Adacel Technologies Ltd has maintained a regular dividend payment schedule, with dividends currently distributed bi-annually. The chart below shows the annual Dividends Per Share for tracking historical trends.
Dissecting Adacel Technologies Ltd's Dividend Yield and Growth
As of today, Adacel Technologies Ltd has a 12-month trailing dividend yield of 7.55% and a 12-month forward dividend yield of 4.76%. This suggests an expectation of decreased dividend payments over the next 12 months.
Over the past three years, Adacel Technologies Ltd's annual dividend growth rate was 74.70%. However, extending to a five-year horizon, this rate decreased to 10.90% per year. The 5-year yield on cost of Adacel Technologies Ltd stock as of today is approximately 12.66%.
Is the Dividend Sustainable? 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 June 30, 2023, Adacel Technologies Ltd's dividend payout ratio is 0.00.
Adacel Technologies Ltd's profitability rank is 6 out of 10 as of June 30, 2023, suggesting fair profitability. The company has reported net profit in 7 years out of the past 10 years.
Future Prospects: Growth Metrics
To ensure the sustainability of dividends, a company must have robust growth metrics. Adacel Technologies Ltd's growth rank of 6 out of 10 suggests that the company has a fair growth outlook. Revenue is the lifeblood of any company, and Adacel Technologies Ltd's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Adacel Technologies Ltd's revenue has increased by approximately 1.30% per year on average, a rate that underperforms approximately 67.57% of global competitors.
Conclusion
While Adacel Technologies Ltd's dividend payments and growth rate are noteworthy, the company's payout ratio, profitability, and growth metrics indicate a need for cautious optimism. The company's consistent dividend payments, combined with its strong profitability rank, suggest potential for continued returns. However, the anticipated decrease in dividend payments and the relative underperformance in revenue growth compared to global competitors warrant close monitoring. Investors should keep an eye on these factors when considering Adacel Technologies Ltd as a dividend investment.
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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.
This article first appeared on GuruFocus.
