Blackrock Ltd Duration Income Trust's Dividend Analysis
A Comprehensive Look at BLW's Dividend Performance and Sustainability
Blackrock Ltd Duration Income Trust (NYSE:BLW) recently announced a dividend of $0.11 per share, payable on 2023-10-31, with the ex-dividend date set for 2023-10-13. 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 Blackrock Ltd Duration Income Trust's dividend performance and assess its sustainability.
What Does Blackrock Ltd Duration Income Trust Do?
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Blackrock Ltd Duration Income Trust is a diversified investment fund with an investment objective to provide current income and capital appreciation. The Fund's portfolio normally has an average portfolio duration of less than five years.
A Glimpse at Blackrock Ltd Duration Income Trust's Dividend History
Blackrock Ltd Duration Income Trust has maintained a consistent dividend payment record since 2003. Dividends are currently distributed on a monthly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Blackrock Ltd Duration Income Trust's Dividend Yield and Growth
As of today, Blackrock Ltd Duration Income Trust currently has a 12-month trailing dividend yield of 9.15% and a 12-month forward dividend yield of 10.07%. This suggests an expectation of increased dividend payments over the next 12 months.
Over the past three years, Blackrock Ltd Duration Income Trust's annual dividend growth rate was 7.30%. Extended to a five-year horizon, this rate decreased to 5.90% per year.
Based on Blackrock Ltd Duration Income Trust's dividend yield and five-year growth rate, the 5-year yield on cost of Blackrock Ltd Duration Income Trust stock as of today is approximately 12.19%.
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 2023-06-30, Blackrock Ltd Duration Income Trust's dividend payout ratio is 0.89, a figure that may suggest that the company's dividend may not be sustainable.
Blackrock Ltd Duration Income Trust's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Blackrock Ltd Duration Income Trust's profitability 2 out of 10 as of 2023-06-30, suggesting that the dividend may not be sustainable. The company has reported net profit in 5 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. Blackrock Ltd Duration Income Trust's growth rank of 2 out of 10 suggests that the company has poor growth prospects and thus, the dividend may not be sustainable.
Next Steps
Considering the dividend payments, growth rate, payout ratio, profitability, and growth metrics, it appears that Blackrock Ltd Duration Income Trust's dividend may face sustainability challenges. Investors should consider these factors carefully before making 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.
