Crestwood Equity Partners LP's Dividend Analysis
An In-depth Look into the Dividend Performance and Sustainability of Crestwood Equity Partners LP
Crestwood Equity Partners LP(NYSE:CEQP) recently announced a dividend of $0.66 per share, payable on 2023-10-31, with the ex-dividend date set for 2023-10-20. 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 Crestwood Equity Partners LP's dividend performance and assess its sustainability.
What Does Crestwood Equity Partners LP Do?
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Crestwood Equity Partners LP develops, acquires, owns or controls, and operates fee-based assets and operations within the energy midstream sector. The company has a diversified portfolio of crude oil and natural gas gathering, processing, storage, and transportation assets that connect fundamental energy supply with energy demand across North America. It has three reporting segments: Gathering and Processing North, Gathering, and Processing South, and Storage and Logistics. The company serves various producers in unconventional shale plays located across the United States. It generates maximum revenue from the Gathering and Processing North division.
A Glimpse at Crestwood Equity Partners LP's Dividend History
Crestwood Equity Partners LP has maintained a consistent dividend payment record since 2001. Dividends are currently distributed on a quarterly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Crestwood Equity Partners LP's Dividend Yield and Growth
As of today, Crestwood Equity Partners LP currently has a 12-month trailing dividend yield of 8.86% and a 12-month forward dividend yield of 8.86%. This suggests an expectation of same dividend payments over the next 12 months.
Over the past three years, Crestwood Equity Partners LP's annual dividend growth rate was 2.60%. Extended to a five-year horizon, this rate decreased to 1.60% per year. And over the past decade, Crestwood Equity Partners LP's annual dividends per share growth rate stands at -16.50%.
Based on Crestwood Equity Partners LP's dividend yield and five-year growth rate, the 5-year yield on cost of Crestwood Equity Partners LP stock as of today is approximately 9.59%.
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, Crestwood Equity Partners LP's dividend payout ratio is 2.88. This may suggest that the company's dividend may not be sustainable.
Crestwood Equity Partners LP's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Crestwood Equity Partners LP's profitability 6 out of 10 as of 2023-06-30, suggesting fair profitability. The company has reported net profit in 5 years out of past 10 years.
Growth Metrics: The Future Outlook
To ensure the sustainability of dividends, a company must have robust growth metrics. Crestwood Equity Partners LP'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 Crestwood Equity Partners LP's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Crestwood Equity Partners LP's revenue has increased by approximately 13.60% per year on average, a rate that outperforms approximately 55.58% of global competitors.
Next Steps
Considering Crestwood Equity Partners LP's consistent dividend payments, modest growth rate, and fair profitability, investors may want to keep an eye on the company's dividend sustainability. While the payout ratio raises some concerns, the company's revenue growth and profitability rank suggest potential for continued dividend payments. However, it is always crucial for investors to conduct their own thorough research and consider all aspects of a company's financial health before making investment 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.
