Blackstone Inc's Dividend Analysis
Assessing the Sustainability and Growth of Blackstone Inc's Dividends
Blackstone Inc (NYSE:BX) recently announced a dividend of $0.94 per share, payable on 2024-02-12, with the ex-dividend date set for 2024-02-02. 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 Blackstone Inc's dividend performance and assess its sustainability.
What Does Blackstone Inc Do?
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Blackstone is the world's largest alternative asset managers with $1.001 trillion in total assets under management, including $731.1 billion in fee-earning assets under management, at the end of June 2023. The company has four core business segments: private equity (23% of fee-earning AUM and 27% of base management fees); real estate (39% and 44%); credit & insurance (28% and 21%); and hedge fund solutions (10% and 8%). While the firm primarily serves institutional investors (87% of AUM), it also caters to clients in the high-net-worth channel (13%). Blackstone operates through 25 offices located in the Americas (8), Europe and the Middle East (9), and the Asia-Pacific region (8).
A Glimpse at Blackstone Inc's Dividend History
Blackstone Inc has maintained a consistent dividend payment record since 2007. Dividends are currently distributed on a quarterly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Blackstone Inc's Dividend Yield and Growth
As of today, Blackstone Inc currently has a 12-month trailing dividend yield of 2.62% and a 12-month forward dividend yield of 2.64%. This suggests an expectation of increased dividend payments over the next 12 months. Over the past three years, Blackstone Inc's annual dividend growth rate was 37.00%. Extended to a five-year horizon, this rate decreased to 15.20% per year. And over the past decade, Blackstone Inc's annual dividends per share growth rate stands at an impressive 14.80%.
Based on Blackstone Inc's dividend yield and five-year growth rate, the 5-year yield on cost of Blackstone Inc stock as of today is approximately 5.32%.
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, Blackstone Inc's dividend payout ratio is 1.81, which may suggest that the company's dividend may not be sustainable.
Blackstone Inc's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Blackstone Inc's profitability 5 out of 10 as of 2023-12-31, suggesting fair profitability. The company has reported positive net income for each 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. Blackstone Inc's growth rank of 5 out of 10 suggests that the company has a fair growth outlook. Revenue is the lifeblood of any company, and Blackstone Inc's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Blackstone Inc's revenue has increased by approximately 1.80% per year on average, a rate that underperforms than approximately 57.75% 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, Blackstone Inc's earnings increased by approximately -8.00% per year on average, a rate that underperforms than approximately 67.9% of global competitors.
Lastly, the company's 5-year EBITDA growth rate of 10.40%, which underperforms than approximately 39.89% of global competitors.
Next Steps
In conclusion, Blackstone Inc's robust dividend history and impressive growth rates in dividends per share over the past decade highlight its commitment to returning value to shareholders. However, the high payout ratio and underperforming growth metrics compared to industry peers raise questions about the long-term sustainability of these dividend payments. Investors should closely monitor the company's profitability and growth prospects, which are crucial for the maintenance and potential increase of future dividends. Value investors considering Blackstone Inc for its dividend offerings may also want to explore further high-dividend yield opportunities. 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.
