Cornerstone Total Return Fund Inc's Dividend Analysis
Unraveling the Dividend Performance and Sustainability of Cornerstone Total Return Fund Inc
Cornerstone Total Return Fund Inc(CRF) recently announced a dividend of $0.12 per share, payable on 2023-10-31, with the ex-dividend date set for 2023-10-13. 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 delve into Cornerstone Total Return Fund Inc's dividend performance and assess its sustainability.
What Does Cornerstone Total Return Fund Inc Do?
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Cornerstone Total Return Fund Inc is a diversified closed-end management company. Its primary objective is capital appreciation with current income as a secondary objective. The company invests in sectors such as Information Technology; Health Care; Financials; Communication Services; Industrials; Utilities; Energy; Real Estate and others.
A Glimpse at Cornerstone Total Return Fund Inc's Dividend History
Cornerstone Total Return Fund Inc has maintained a consistent dividend payment record since 1993. Dividends are currently distributed on a monthly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Cornerstone Total Return Fund Inc's Dividend Yield and Growth
As of today, Cornerstone Total Return Fund Inc currently has a 12-month trailing dividend yield of 20.66% and a 12-month forward dividend yield of 18.44%. This suggests an expectation of decreased dividend payments over the next 12 months.
Over the past three years, Cornerstone Total Return Fund Inc's annual dividend growth rate was -2.60%. Extended to a five-year horizon, this rate decreased to -6.30% per year. And over the past decade, Cornerstone Total Return Fund Inc's annual dividends per share growth rate stands at -8.90%.
Based on Cornerstone Total Return Fund Inc's dividend yield and five-year growth rate, the 5-year yield on cost of Cornerstone Total Return Fund Inc stock as of today is approximately 14.92%.
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 2023-06-30, Cornerstone Total Return Fund Inc's dividend payout ratio is 1.34. This may suggest that the company's dividend may not be sustainable.
Cornerstone Total Return Fund Inc's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Cornerstone Total Return Fund Inc's profitability 3 out of 10 as of 2023-06-30, suggesting the dividend may not be sustainable. The company has reported net profit in 7 years out of past 10 years.
Growth Metrics: The Future Outlook
To ensure the sustainability of dividends, a company must have robust growth metrics. Cornerstone Total Return Fund Inc's growth rank of 3 out of 10 suggests that the company has poor growth prospects and thus, the dividend may not be sustainable.
Next Steps
Given the current dividend payments, growth rates, and payout ratio, it's clear that Cornerstone Total Return Fund Inc's dividend sustainability is a concern. The company's low profitability and growth ranks further underscore this concern. Investors should closely monitor the company's future earnings and growth prospects to make informed decisions. 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.
