BB Seguridade Participacoes SA's Dividend Analysis
Investigating the Dividend Profile of BB Seguridade Participacoes SA
BB Seguridade Participacoes SA (BBSEY) recently announced a dividend of $0.25 per share, payable on a future date yet to be announced, with the ex-dividend date set for 2024-02-14. 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 delve into BB Seguridade Participacoes SA's dividend performance and assess its sustainability.
What Does BB Seguridade Participacoes SA Do?
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BB Seguridade Participacoes SA is a diversified insurance company that operates two segments: insurance and brokerage. The revenue generation is mostly split between these two segments. Its insurance segment focuses on life, property, vehicle, and special-risk insurance. It also provides capitalization plans as well as reinsurance. The company's brokerage segment operates the facilitation of business insurance and reinsurance. BB Seguridade generates its maximum revenue from the Insurance Segment. The company considers mergers and acquisitions as a component of its operational growth plan.
A Glimpse at BB Seguridade Participacoes SA's Dividend History
BB Seguridade Participacoes SA has maintained a consistent dividend payment record since 2014. Dividends are currently distributed on a bi-annual basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down BB Seguridade Participacoes SA's Dividend Yield and Growth
As of today, BB Seguridade Participacoes SA currently has a 12-month trailing dividend yield of 9.73% and a 12-month forward dividend yield of 8.23%. This suggests an expectation of decreased dividend payments over the next 12 months.
Over the past three years, BB Seguridade Participacoes SA's annual dividend growth rate was 7.80%. Extended to a five-year horizon, this rate increased to 9.20% per year. And over the past decade, BB Seguridade Participacoes SA's annual dividends per share growth rate stands at an impressive 11.60%.
Based on BB Seguridade Participacoes SA's dividend yield and five-year growth rate, the 5-year yield on cost of BB Seguridade Participacoes SA stock as of today is approximately 15.11%.
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, BB Seguridade Participacoes SA's dividend payout ratio is 0.84, which may suggest that the company's dividend may not be sustainable.
BB Seguridade Participacoes SA's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks BB Seguridade Participacoes SA's profitability 8 out of 10 as of 2023-12-31, 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. BB Seguridade Participacoes SA'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 BB Seguridade Participacoes SA's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. BB Seguridade Participacoes SA's revenue has increased by approximately 14.50% per year on average, a rate that outperforms approximately 82.18% 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, BB Seguridade Participacoes SA's earnings increased by approximately 27.40% per year on average, a rate that outperforms approximately 81.84% of global competitors.
Lastly, the company's 5-year EBITDA growth rate of 17.30%, which outperforms approximately 78.69% of global competitors.
Concluding Insights on BB Seguridade Participacoes SA's Dividend Profile
BB Seguridade Participacoes SA's dividend payments, growth rate, payout ratio, profitability, and growth metrics paint a comprehensive picture of its financial health and dividend sustainability. With a solid track record of dividend payments and a robust growth outlook, BB Seguridade Participacoes SA appears to be a viable option for value investors seeking income-generating assets. However, the relatively high payout ratio warrants close monitoring to ensure long-term dividend sustainability. As investors consider adding BBSEY to their portfolios, they should weigh these factors against their investment strategy and risk tolerance.
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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.
