Corteva Inc's Dividend Analysis
Assessing the Upcoming Dividend and Financial Health of Corteva Inc
Corteva Inc(NYSE:CTVA) recently announced a dividend of $0.16 per share, payable on 2024-03-15, with the ex-dividend date set for 2024-02-29. 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 Corteva Inc's dividend performance and assess its sustainability.
What Does Corteva Inc Do?
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Corteva is an agriculture pure play that was formed in 2019 when it was spun off from DowDuPont. The company is a leader in the development of new seed and crop chemicals products. Seeds generate a little over half of profits with the remainder coming from crop protection chemicals. Although Corteva operates globally, around half of revenue comes from North America.
A Glimpse at Corteva Inc's Dividend History
Corteva Inc has maintained a consistent dividend payment record since 2019. Dividends are currently distributed on a quarterly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Corteva Inc's Dividend Yield and Growth
As of today, Corteva Inc currently has a 12-month trailing dividend yield of 1.12% and a 12-month forward dividend yield of 1.16%. This suggests an expectation of increased dividend payments over the next 12 months.
Over the past three years, Corteva Inc's annual dividend growth rate was 6.00%.
Based on Corteva Inc's dividend yield and five-year growth rate, the 5-year yield on cost of Corteva Inc stock as of today is approximately 1.12%.
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 2023-12-31, Corteva Inc's dividend payout ratio is 0.23.
Corteva Inc's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Corteva Inc's profitability 6 out of 10 as of 2023-12-31, suggesting fair profitability. The company has reported net profit in 6 years out of past 10 years.
Growth Metrics: The Future Outlook
To ensure the sustainability of dividends, a company must have robust growth metrics. Corteva Inc'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 Corteva Inc's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Corteva Inc's revenue has increased by approximately 8.50% per year on average, a rate that underperforms approximately 68.14% 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, Corteva Inc's earnings increased by approximately 21.50% per year on average, a rate that underperforms approximately 50.99% of global competitors.
Lastly, the company's 5-year EBITDA growth rate of 14.30%, which underperforms approximately 56.86% of global competitors.
Next Steps
Considering Corteva Inc's consistent dividend payments, moderate dividend growth rate, manageable payout ratio, fair profitability, and growth metrics, investors may find the company to be a stable dividend-paying stock. While the growth rates in revenue and earnings per share may not be leading the industry, they do indicate a company with the potential to maintain its dividend payments. The key for investors is to determine whether Corteva Inc's current trajectory aligns with their investment goals and if the agricultural sector's outlook supports the company's financial health. For those interested in further exploring high-yield opportunities, 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.
