CRH PLC's Dividend Analysis
Unveiling the Dividend Dynamics of CRH PLC
CRH PLC (NYSE:CRH) recently announced a dividend of $0.35 per share, payable on 2024-04-17, with the ex-dividend date set for 2024-03-14. 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?
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CRH is a global manufacturer of a range of building products used in construction projects, operating via a vertically integrated business model. The past decade has seen CRH transform into a leading building materials business, with increasing exposure to upstream building activities such as aggregates and cement. CRH's geographic footprint is predominantly in developed markets, with North America being CRH's largest market, accounting for 75% of EBITDA. The company stands as the largest producer of aggregates and asphalt in the US.
A Glimpse at CRH PLC's Dividend History
CRH PLC has upheld a consistent dividend payment record since 2018, with dividends currently being distributed on a quarterly basis. Below is a chart showing the annual Dividends Per Share to track 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 1.60% and a 12-month forward dividend yield of 3.22%. This indicates an anticipated increase in dividend payments over the next 12 months. However, CRH PLC's dividend yield is near a 10-year low and underperforms 75.32% of global competitors in the Building Materials industry, which may not make it a compelling choice for income-focused investors.
Over the past three years, CRH PLC's annual dividend growth rate was 37.10%, which decreased to 21.10% per year over a five-year period. Consequently, the 5-year yield on cost for CRH PLC stock is approximately 4.17% as of today.
The Sustainability Question: Payout Ratio and Profitability
To assess the sustainability of the dividend, one must examine the company's payout ratio. The dividend payout ratio is a metric that indicates the proportion of earnings distributed as dividends. CRH PLC's dividend payout ratio is 0.51 as of 2023-12-31, suggesting a balance between retaining earnings for growth and rewarding shareholders. Additionally, CRH PLC's profitability rank of 7 out of 10, coupled with a decade of positive net income, signals good profitability prospects.
Growth Metrics: The Future Outlook
CRH PLC's growth rank of 7 out of 10 reflects a strong growth trajectory relative to competitors. The company's revenue per share and 3-year revenue growth rate of 13.60% per year outperform approximately 75% of global competitors. Moreover, CRH PLC's 3-year EPS growth rate of 56.40% per year and a 5-year EBITDA growth rate of 21.30% outperform the majority of global competitors, underscoring the company's earnings growth and dividend sustainability.
Next Steps
In conclusion, CRH PLC's upcoming dividend payment, historical dividend growth, moderate payout ratio, strong profitability, and robust growth metrics collectively paint a picture of a company with a sustainable dividend profile. These factors are crucial for value investors considering CRH PLC as part of a dividend-focused investment strategy. The company's ability to balance growth and shareholder returns positions it as a potentially attractive investment, especially for those seeking exposure to the building materials sector. For further investment research, GuruFocus Premium users can utilize the High Dividend Yield Screener to discover high-dividend yield stocks.
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.
