The Brink's Co's Dividend Analysis
Assessing the Sustainability of The Brink's Co's Upcoming Dividend
The Brink's Co (NYSE:BCO) recently announced a dividend of $0.22 per share, payable on 2024-03-01, 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 The Brink's Co's dividend performance and assess its sustainability.
What Does The Brink's Co Do?
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The Brink's Co is a global provider of secure logistics and security solutions for cash and other valuables. In 2020, the company acquired the U.K.-based G4S that reorganized its operating segments to be North America, Latin America, Europe, and Rest of World. It generates maximum revenue from the North America segment, namely from its core business of cash-in-transit and ATM services. The Latin America and Europe segments trail North America in revenue earnings with the Brinks Global Services line of business that specializes in the secure transportation of high-valued commodities, such as jewelry, precious metals, banknotes, and electronics. Brink's customer base includes financial institutions, retails, government agencies, mints, and other commercial businesses.
A Glimpse at The Brink's Co's Dividend History
The Brink's Co has maintained a consistent dividend payment record since 1989. Dividends are currently distributed on a quarterly basis. The Brink's Co has increased its dividend each year since 1996. The stock is thus listed as a dividend aristocrat, an honor that is given to companies that have increased their dividend each year for at least the past 28 years. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down The Brink's Co's Dividend Yield and Growth
As of today, The Brink's Co currently has a 12-month trailing dividend yield of 1.06% and a 12-month forward dividend yield of 1.08%. This suggests an expectation of increased dividend payments over the next 12 months.
Over the past three years, The Brink's Co's annual dividend growth rate was 10.10%. Extended to a five-year horizon, this rate decreased to 7.50% per year. And over the past decade, The Brink's Co's annual dividends per share growth rate stands at 8.00%.
Based on The Brink's Co's dividend yield and five-year growth rate, the 5-year yield on cost of The Brink's Co stock as of today is approximately 1.52%.
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 2023-09-30, The Brink's Co's dividend payout ratio is 0.13.
The Brink's Co's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks The Brink's Co's profitability 6 out of 10 as of 2023-09-30, suggesting fair profitability. The company has reported net profit in 7 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. The Brink's Co's growth rank of 6 out of 10 suggests that the company has a fair growth outlook.
Revenue is the lifeblood of any company, and The Brink's Co's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. The Brink's Co's revenue has increased by approximately 9.60% per year on average, a rate that outperforms approximately 64.66% 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, The Brink's Co's earnings increased by approximately 15.50% per year on average, a rate that outperforms approximately 58.39% of global competitors.
Lastly, the company's 5-year EBITDA growth rate of 13.20%, which outperforms approximately 62.72% of global competitors.
Next Steps
Considering The Brink's Co's consistent dividend payments, robust dividend growth rate, prudent payout ratio, fair profitability, and promising growth metrics, the company's dividend appears to be on a sustainable path. Investors seeking to diversify their portfolios with a stock that offers a steady stream of income may find The Brink's Co an attractive option. With the company's commitment to safeguarding and increasing shareholder value, the future outlook for its dividend payments seems promising. Will The Brink's Co continue to uphold its dividend aristocrat status in the years to come? For those interested in exploring further, 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.
