CRH PLC's Dividend Analysis
Understanding the Dividend Performance and Sustainability of CRH PLC
CRH PLC (NYSE:CRH) recently announced a dividend of $0.25 per share, payable on 2023-11-22, with the ex-dividend date set for 2023-10-19. 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 CRH PLC's dividend performance and assess its sustainability.
What Does CRH PLC Do?
This Powerful Chart Made Peter Lynch 29% A Year For 13 Years
How to calculate the intrinsic value of a stock?
CRH is a global manufacturer of various building products used in construction projects, operating through a vertically integrated business model. Over the past decade, CRH has transformed into a leading building materials business, with increasing exposure to upstream building activities such as aggregates and cement. CRH's geographic footprint is primarily across developed markets. North America is CRH's largest market, accounting for 59% of sales. The company is the largest producer of aggregates and asphalt in the U.S.
A Glimpse at CRH PLC's Dividend History
CRH PLC has maintained a consistent dividend payment record since 2018, with dividends currently distributed on a bi-annual basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down CRH PLC's Dividend Yield and Growth
As of today, CRH PLC currently has a 12-month trailing dividend yield of 2.20% and a 12-month forward dividend yield of 2.21%. This suggests an expectation of increased dividend payments over the next 12 months. Over the past three years, CRH PLC's annual dividend growth rate was 14.60%. Based on CRH PLC's dividend yield and five-year growth rate, the 5-year yield on cost of CRH PLC stock as of today is approximately 2.20%.
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, CRH PLC's dividend payout ratio is 0.33.
CRH PLC's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks CRH PLC's profitability 7 out of 10 as of 2023-06-30, suggesting good profitability prospects. The company has reported net profit in 9 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. CRH PLC's growth rank of 7 out of 10 suggests that the company's growth trajectory is good relative to its competitors.
Revenue is the lifeblood of any company, and CRH PLC's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. CRH PLC's revenue has increased by approximately 7.10% per year on average, a rate that outperforms approximately 57.39% 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, CRH PLC's earnings increased by approximately 20.00% per year on average, a rate that outperforms approximately 68.81% of global competitors.
Lastly, the company's 5-year EBITDA growth rate of 9.10%, outperforms approximately 57% of global competitors.
Next Steps
Considering CRH PLC's consistent dividend payments, impressive growth rate, sustainable payout ratio, strong profitability, and robust growth metrics, it appears to be a promising investment for dividend-focused investors. However, like any investment, prospective investors are encouraged to conduct thorough research and consider their financial goals and risk tolerance before investing in CRH PLC.
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.
