CALAMOS CONVERTIBLE OPPORTUNITIES & INCOME FUND's Dividend Analysis
Assessing the Dividend Profile of CALAMOS CONVERTIBLE OPPORTUNITIES & INCOME FUND
CALAMOS CONVERTIBLE OPPORTUNITIES & INCOME FUND (NASDAQ:CHI) recently announced a dividend of $0.1 per share, payable on 2024-02-20, with the ex-dividend date set for 2024-02-09. 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 CALAMOS CONVERTIBLE OPPORTUNITIES & INCOME FUND's dividend performance and assess its sustainability.
What Does CALAMOS CONVERTIBLE OPPORTUNITIES & INCOME FUND Do?
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CALAMOS CONVERTIBLE OPPORTUNITIES & INCOME FUND operates as a closed-end management investment company. Its investment objective is to provide total return through a combination of capital appreciation and current income. The Fund invests in convertible securities and high-yield securities.
A Glimpse at CALAMOS CONVERTIBLE OPPORTUNITIES & INCOME FUND's Dividend History
CALAMOS CONVERTIBLE OPPORTUNITIES & INCOME FUND has maintained a consistent dividend payment record since 2002, with dividends currently distributed on a monthly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down CALAMOS CONVERTIBLE OPPORTUNITIES & INCOME FUND's Dividend Yield and Growth
As of today, CALAMOS CONVERTIBLE OPPORTUNITIES & INCOME FUND currently has a 12-month trailing dividend yield of 10.33% and a 12-month forward dividend yield of 10.33%, suggesting an expectation of the same dividend payments over the next 12 months. Over the past three years, CALAMOS CONVERTIBLE OPPORTUNITIES & INCOME FUND's annual dividend growth rate was 5.90%, which decreased to 2.30% per year when extended to a five-year horizon. Based on CALAMOS CONVERTIBLE OPPORTUNITIES & INCOME FUND's dividend yield and five-year growth rate, the 5-year yield on cost of CALAMOS CONVERTIBLE OPPORTUNITIES & INCOME FUND stock as of today is approximately 11.57%.
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 2023-10-31, CALAMOS CONVERTIBLE OPPORTUNITIES & INCOME FUND's dividend payout ratio is 0.00. CALAMOS CONVERTIBLE OPPORTUNITIES & INCOME FUND's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks CALAMOS CONVERTIBLE OPPORTUNITIES & INCOME FUND's profitability 2 out of 10 as of 2023-10-31, suggesting 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. CALAMOS CONVERTIBLE OPPORTUNITIES & INCOME FUND'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
In conclusion, while CALAMOS CONVERTIBLE OPPORTUNITIES & INCOME FUND offers a high dividend yield, the sustainability of these payments is in question due to the company's low profitability and growth ranks. Investors should weigh the attractive yield against the potential risks associated with the Fund's future performance and ability to maintain its dividend payments. For those seeking to diversify their income-generating portfolio, 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.
