BlueScope Steel Ltd (BLSFF): A Deep Dive Into Its Dividend Performance and Sustainability
A comprehensive analysis of BlueScope Steel Ltd's dividend history, yield, growth rates, and payout ratio
BlueScope Steel Ltd (BLSFF) recently announced a dividend of $0.25 per share, payable on 2023-10-17, with the ex-dividend date set for 2023-09-12. 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 deep dive into BlueScope Steel Ltd's dividend performance and assess its sustainability.
About BlueScope Steel Ltd (BLSFF)
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BlueScope is an Australian-based steelmaking firm with five business units. The Australian Steel Products segment mainly specialises in branded coated and painted flat steel products, sold domestically. North Star is the group's U.S. mini-mill specialising in the production of hot rolled coil for U.S. construction and automotive sectors. Building Products Asia and North America operate across Southeast Asia, China, India, and the U.S. West Coast involved in metal-coating, painting, and roll-forming. New Zealand Steel and the Pacific Islands business produces flat and long steel products for New Zealand and building components for the Pacific Islands. The Buildings North America segment specialises in non-residential buildings, including materials manufacturing and support services.
BlueScope Steel Ltd's Dividend History
BlueScope Steel Ltd has maintained a consistent dividend payment record since 2015. Dividends are currently distributed on a bi-annually basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
BlueScope Steel Ltd's Dividend Yield and Growth
As of today, BlueScope Steel Ltd currently has a 12-month trailing dividend yield of 2.44% and a 12-month forward dividend yield of 2.41%. This suggests an expectation of decrease dividend payments over the next 12 months.
Over the past three years, BlueScope Steel Ltd's annual dividend growth rate was 52.90%. Extended to a five-year horizon, this rate decreased to 38.50% per year. Based on BlueScope Steel Ltd's dividend yield and five-year growth rate, the 5-year yield on cost of BlueScope Steel Ltd stock as of today is approximately 12.43%.
Assessing Dividend Sustainability: 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, BlueScope Steel Ltd's dividend payout ratio is 0.23.
BlueScope Steel Ltd's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks BlueScope Steel Ltd's profitability 9 out of 10 as of 2023-06-30, suggesting good profitability prospects. The company has reported net profit in 9 years out of past 10 years.
Growth Metrics: A Look Into the Future
To ensure the sustainability of dividends, a company must have robust growth metrics. BlueScope Steel Ltd's growth rank of 9 out of 10 suggests that the company's growth trajectory is good relative to its competitors.
Revenue is the lifeblood of any company, and BlueScope Steel Ltd's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. BlueScope Steel Ltd's revenue has increased by approximately 20.80% per year on average, a rate that outperforms than approximately 78.18% 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, BlueScope Steel Ltd's earnings increased by approximately 121.30% per year on average, a rate that outperforms than approximately 89.15% of global competitors.
Lastly, the company's 5-year EBITDA growth rate of 13.50%, which outperforms than approximately 46.76% of global competitors.
Conclusion
In conclusion, BlueScope Steel Ltd's consistent dividend payments, impressive growth rate, low payout ratio, high profitability, and robust growth metrics make it a compelling choice for dividend investors. The company's ability to grow its earnings and revenue at a rate that outperforms a significant number of global competitors further bolsters its position. However, investors should continue to monitor these metrics to ensure the ongoing sustainability of dividends.
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This article first appeared on GuruFocus.
