City Office REIT Inc (CIO): An In-depth Analysis of Dividend Performance and Sustainability
Looking Beyond the Numbers: A Comprehensive Review of City Office REIT Inc's Dividend History, Yield, and Growth Rates
City Office REIT Inc (NYSE:CIO) has recently announced a dividend of $0.1 per share, which is set to be paid on October 24, 2023. With the ex-dividend date marked for October 6, 2023, investors are keenly awaiting this upcoming payment. This announcement has also brought the company's dividend history, yield, and growth rates under scrutiny. This detailed analysis, powered by GuruFocus data, aims to shed light on City Office REIT Inc's dividend performance and evaluate its sustainability.
Understanding City Office REIT Inc
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City Office REIT Inc is a real estate investment trust (REIT) with a primary focus on acquiring, owning, and operating high-quality office properties located predominantly in Sun Belt markets. The company's portfolio includes office buildings in metropolitan areas such as Dallas, Denver, Orlando, Phoenix, Portland, Raleigh, San Diego, Seattle, and Tampa.
A Look at City Office REIT Inc's Dividend History
Since 2014, City Office REIT Inc has maintained a consistent dividend payment record. The dividends are distributed on a quarterly basis, providing a steady income stream for its shareholders. The chart below provides a historical perspective on the company's annual Dividends Per Share.
Unpacking City Office REIT Inc's Dividend Yield and Growth
As of the current date, City Office REIT Inc boasts a trailing dividend yield of 17.87% for the last 12 months and a forward dividend yield of 10.23% for the next 12 months. This indicates an anticipated decrease in dividend payments over the upcoming year.
Over the past three years, the company's annual dividend growth rate was -5.20%. When extended to a five-year horizon, this rate increases to -2.90% per year. Based on the dividend yield and the five-year growth rate, the 5-year yield on cost of City Office REIT Inc stock stands at approximately 15.42%.
Evaluating Dividend Sustainability: Payout Ratio and Profitability
The sustainability of a company's dividend is often gauged through its payout ratio. This dividend payout ratio reveals the portion of earnings that the company distributes as dividends. A lower ratio indicates that the company retains a significant part of its earnings, ensuring funds for future growth and unexpected downturns. As of June 30, 2023, City Office REIT Inc's dividend payout ratio stands at 0.00.
Furthermore, City Office REIT Inc's profitability rank is 6 out of 10 as of June 30, 2023, suggesting fair profitability. The company has reported net profit in 6 out of the past 10 years.
Assessing Growth Metrics for Future Prospects
For the sustainability of dividends, robust growth metrics are crucial. City Office REIT Inc's growth rank of 6 out of 10 suggests a fair growth outlook. The company's revenue per share and the 3-year revenue growth rate indicate a strong revenue model. With an average increase of approximately 5.80% per year, City Office REIT Inc's revenue growth outperforms approximately 71.79% of global competitors.
Concluding Thoughts
In conclusion, while City Office REIT Inc's upcoming dividend payment is a welcome announcement for its investors, a comprehensive analysis of its dividend performance reveals a more nuanced picture. The company's dividend growth rate, payout ratio, profitability, and growth metrics all play a crucial role in assessing the sustainability of its dividends. While some indicators suggest a strong position, others hint at potential challenges. It is, therefore, imperative for investors to consider all these factors when making investment decisions.
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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.
