Barry Callebaut AG's Dividend Analysis
Unlocking the Value of Barry Callebaut AG's Dividend Potential
Barry Callebaut AG (BRRLY) recently announced a dividend of $0.32 per share, payable on 2024-01-25, with the ex-dividend date set for 2024-01-08. 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 Barry Callebaut AG's dividend performance and assess its sustainability.
What Does Barry Callebaut AG Do?
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Barry Callebaut is a significant manufacturer and supplier of cocoa and chocolate ingredients, employing over 13,000 people. Customers include food and beverage makers as well as craftspeople, chocolatiers, pastry chefs, and bakers who utilize chocolate professionally. Barry Callebaut is vertically integrated from raw material (cocoa bean) procurement through chocolate manufacture, while not owning any cocoa farms. The firm produces around 40% of the world's industrial chocolate (open market), and its products are used in approximately 20% of the world's chocolate and cocoa goods. Barry Callebaut's sustainability endeavors are reflected in the fact that the company's Sustainalytics ESG Risk Rating is one of the lowest in its subcategory and first among its peers.
A Glimpse at Barry Callebaut AG's Dividend History
Barry Callebaut AG has maintained a consistent dividend payment record since 2019. Dividends are currently distributed on a yearly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Barry Callebaut AG's Dividend Yield and Growth
As of today, Barry Callebaut AG currently has a 12-month trailing dividend yield of 1.93% and a 12-month forward dividend yield of 2.05%. This suggests an expectation of increased dividend payments over the next 12 months. Over the past three years, Barry Callebaut AG's annual dividend growth rate was 2.50%. Extended to a five-year horizon, this rate increased to 12.90% per year. And over the past decade, Barry Callebaut AG's annual dividends per share growth rate stands at an impressive 11.30%.
Based on Barry Callebaut AG's dividend yield and five-year growth rate, the 5-year yield on cost of Barry Callebaut AG stock as of today is approximately 3.54%.
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 2023-08-31, Barry Callebaut AG's dividend payout ratio is 0.34.
Barry Callebaut AG's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Barry Callebaut AG's profitability 8 out of 10 as of 2023-08-31, suggesting good profitability prospects. The company has reported positive net income for each of 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. Barry Callebaut AG's growth rank of 8 out of 10 suggests that the company's growth trajectory is good relative to its competitors.
Revenue is the lifeblood of any company, and Barry Callebaut AG's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Barry Callebaut AG's revenue has increased by approximately 7.20% per year on average, a rate that outperforms approximately 51.22% 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, Barry Callebaut AG's earnings increased by approximately 11.00% per year on average, a rate that outperforms approximately 54.22% of global competitors.
Lastly, the company's 5-year EBITDA growth rate of 5.00%, which outperforms approximately 49.54% of global competitors.
Next Steps
In conclusion, Barry Callebaut AG's dividend payments, growth rates, and payout ratios present a compelling picture for value investors. The company's consistent dividend history, coupled with a reasonable payout ratio and robust profitability, indicate a sustainable dividend policy. Growth metrics further reinforce the company's ability to maintain and potentially increase its dividends, making Barry Callebaut AG an attractive option for those seeking both stability and growth in dividend income. Investors would do well to consider the company's financial health and industry position as they make their investment decisions. GuruFocus Premium users can screen for high-dividend yield stocks 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.
This article first appeared on GuruFocus.
