BlackRock Health Sciences Trust II's Dividend Analysis
Insights into BMEZ's Dividend Performance and Sustainability
BlackRock Health Sciences Trust II(NYSE:BMEZ) recently announced a dividend of $0.09 per share, payable on October 31, 2023, with the ex-dividend date set for October 13, 2023. As investors anticipate this upcoming payment, it's crucial to examine the company's dividend history, yield, and growth rates. Using the data from GuruFocus, we delve into BlackRock Health Sciences Trust II's dividend performance and assess its sustainability.
Understanding BlackRock Health Sciences Trust II's Business Model
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BlackRock Health Sciences Trust II is a closed-end management investment company. Its investment objective is to provide total return through a combination of current income and long-term capital appreciation. The Trust seeks to achieve this by investing, under normal market conditions, at least 80% of its total assets in equity securities of energy and natural resources companies and equity derivatives with exposure to the energy and natural resources industry.
A Look at BlackRock Health Sciences Trust II's Dividend History
BlackRock Health Sciences Trust II has maintained a consistent dividend payment record since 2021, with dividends currently distributed on a monthly basis. The chart below shows the annual Dividends Per Share for tracking historical trends.
Breaking Down BlackRock Health Sciences Trust II's Dividend Yield and Growth
As of today, BlackRock Health Sciences Trust II has a 12-month trailing dividend yield of 12.31% and a 12-month forward dividend yield of 7.92%. This suggests a projected decrease in dividend payments over the next 12 months. Despite this, BlackRock Health Sciences Trust II's dividend yield of 12.31% is near a 10-year high and outperforms 89.99% of global competitors in the Asset Management industry, making it an attractive proposition for income investors.
According to BlackRock Health Sciences Trust II's dividend yield and five-year growth rate, the 5-year yield on cost of BlackRock Health Sciences Trust II stock as of today is approximately 12.31%.
Assessing Dividend Sustainability: Payout Ratio and Profitability
The sustainability of a dividend is determined by evaluating the company's payout ratio. The dividend payout ratio reveals the portion of earnings the company distributes as dividends. A lower ratio suggests that the company retains a significant part of its earnings, ensuring fund availability for future growth and unexpected downturns. As of June 30, 2023, BlackRock Health Sciences Trust II's dividend payout ratio is 3.16, which may cast doubts on the dividend's sustainability.
BlackRock Health Sciences Trust II's profitability rank provides an understanding of the company's earnings prowess relative to its peers. As of June 30, 2023, GuruFocus ranks BlackRock Health Sciences Trust II's profitability 1 out of 10, suggesting the dividend may not be sustainable. The company has reported net profit in 1 year out of the past 10 years.
Future Prospects: Growth Metrics
A company must have robust growth metrics to ensure the sustainability of dividends. BlackRock Health Sciences Trust II's growth rank of 1 out of 10 suggests that the company has poor growth prospects, which might indicate that the dividend may not be sustainable.
Conclusion
While BlackRock Health Sciences Trust II offers an attractive dividend yield, investors should consider the company's payout ratio, profitability rank, and growth rank as these factors can affect the sustainability of dividends. It's crucial to monitor these metrics and the company's overall financial health to make informed 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.
