Atlas Arteria Ltd's Dividend Analysis
Understanding the Dividend Dynamics of Atlas Arteria Ltd (MAQAF)
Atlas Arteria Ltd (MAQAF) recently announced a dividend of $0.2 per share, payable on 2024-04-08, with the ex-dividend date set for 2024-03-26. 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 Atlas Arteria Ltd's dividend performance and assess its sustainability.
What Does Atlas Arteria Ltd Do?
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Atlas Arteria is a global toll-road investor created out of the reorganization of Macquarie Infrastructure Group in 2010. The firm's main asset is a 31.1% stake in Autoroutes Paris-Rhin-Rhone, or APRR. APRR owns concessions to toll more than 2,300 kilometers of motorways in eastern France, most ending late 2035. The firm also wholly owns the Dulles Greenway and 66.7% of the Chicago Skyway, both in the US.
A Glimpse at Atlas Arteria Ltd's Dividend History
Atlas Arteria Ltd has maintained a consistent dividend payment record since 2013. Dividends are currently distributed on a bi-annually basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Atlas Arteria Ltd's Dividend Yield and Growth
As of today, Atlas Arteria Ltd currently has a 12-month trailing dividend yield of 7.45% and a 12-month forward dividend yield of 7.46%. This suggests an expectation of increased dividend payments over the next 12 months.
Over the past three years, Atlas Arteria Ltd's annual dividend growth rate was 57.20%. Extended to a five-year horizon, this rate decreased to 26.20% per year. And over the past decade, Atlas Arteria Ltd's annual dividends per share growth rate stands at an impressive 29.90%.
Based on Atlas Arteria Ltd's dividend yield and five-year growth rate, the 5-year yield on cost of Atlas Arteria Ltd stock as of today is approximately 23.85%.
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 2023-12-31, Atlas Arteria Ltd's dividend payout ratio is 1.79, which may suggest that the company's dividend may not be sustainable.
Atlas Arteria Ltd's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Atlas Arteria Ltd's profitability 4 out of 10 as of 2023-12-31, suggesting the dividend may not be sustainable. The company has reported net profit in 7 years out of the past 10 years.
Growth Metrics: The Future Outlook
To ensure the sustainability of dividends, a company must have robust growth metrics. Atlas Arteria Ltd's growth rank of 4 out of 10 suggests that the company has poor growth prospects and thus, the dividend may not be sustainable.
Revenue is the lifeblood of any company, and Atlas Arteria Ltd's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Atlas Arteria Ltd's revenue has decreased by approximately -4.30% per year on average, a rate that underperforms approximately 71.93% 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, Atlas Arteria Ltd's earnings increased by approximately 46.40% per year on average, a rate that underperforms approximately 14.52% of global competitors.
Lastly, the company's 5-year EBITDA growth rate of 24.00%, which underperforms approximately 17.45% of global competitors.
Next Steps
Considering Atlas Arteria Ltd's dividend payments, growth rate, payout ratio, profitability, and growth metrics, investors are faced with a nuanced picture. While the dividend yield and historical growth rates are attractive, the sustainability of such dividends is questionable given the payout ratio and mixed profitability and growth metrics. It's crucial for investors to weigh these factors against their investment strategy and risk tolerance. Will Atlas Arteria Ltd maintain its dividend attractiveness, or are there underlying challenges that may affect future payouts? This is a key question for investors to ponder as they consider adding MAQAF to their portfolios. For those seeking high-dividend yield stocks, GuruFocus Premium users can utilize the High Dividend Yield Screener to find suitable investment 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.
This article first appeared on GuruFocus.
