Deep Dive: Analyzing the Dividend Performance of Camden Property Trust (CPT)
A Comprehensive Look at the Dividend History, Yield, Growth, and Sustainability of Camden Property Trust (NYSE:CPT)
Camden Property Trust (NYSE:CPT) recently announced a dividend of $1 per share, payable on 2023-10-17, with the ex-dividend date set for 2023-09-28. 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 deep dive into Camden Property Trusts dividend performance and assess its sustainability.
Understanding Camden Property Trust
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Camden Property Trust is a real estate investment trust primarily engaged in the acquisition, management, and development of multifamily apartment communities across the United States. The company's real estate portfolio consists primarily of apartment properties throughout the Sun Belt. Houston, Dallas, Las Vegas, and Atlanta represent some of Camden's largest housing markets in terms of apartment units. The firm derives nearly all of its revenue from the leasing of properties to tenants through short-term agreements. Camden Property derives the majority of its revenue from the Washington D.C., Los Angeles, Houston, Atlanta, and southeastern Florida areas.
Camden Property Trust's Dividend History
Camden Property Trust has maintained a consistent dividend payment record since 1993. Dividends are currently distributed on a quarterly basis. Camden Property Trust has increased its dividend each year since 2010. The stock is thus listed as a dividend achiever, an honor that is given to companies that have increased their dividend each year for at least the past 13 years.
Below is a chart showing annual Dividends Per Share for tracking historical trends.
Camden Property Trust's Dividend Yield and Growth
As of today, Camden Property Trust currently has a 12-month trailing dividend yield of 4.07% and a 12-month forward dividend yield of 4.18%. This suggests an expectation of increase dividend payments over the next 12 months.
Over the past three years, Camden Property Trust's annual dividend growth rate was 5.50%. Extended to a five-year horizon, this rate decreased to 4.10% per year. And over the past decade, Camden Property Trust's annual dividends per share growth rate stands at 4.30%.
Based on Camden Property Trust's dividend yield and five-year growth rate, the 5-year yield on cost of Camden Property Trust stock as of today is approximately 4.98%.
Dividend Sustainability: 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, Camden Property Trust's dividend payout ratio is 2.06. This may suggest that the company's dividend may not be sustainable.
Camden Property Trust's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Camden Property Trust's profitability 8 out of 10 as of 2023-06-30, suggesting good profitability prospects. The company has reported positive net income for each of year over the past decade, further solidifying its high profitability.
Camden Property Trust's Growth Metrics and Future Outlook
To ensure the sustainability of dividends, a company must have robust growth metrics. Camden Property Trust's growth rank of 8 out of 10 suggests that the company's growth trajectory is good relative to its competitors.
Revenue is the lifeblood of any company, and Camden Property Trust's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Camden Property Trust's revenue has increased by approximately 8.30% per year on average, a rate that outperforms than approximately 79.09% 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, Camden Property Trust's earnings increased by approximately 39.60% per year on average, a rate that outperforms than approximately 83.3% of global competitors.
Lastly, the company's 5-year EBITDA growth rate of 20.10%, which outperforms than approximately 79.58% of global competitors.
Concluding Thoughts
In conclusion, while Camden Property Trust's dividend payout ratio may raise some concerns about the sustainability of its dividends, the company's strong profitability and growth metrics paint a promising picture. The consistent increase in dividends, coupled with a robust growth rate, suggests that Camden Property Trust is committed to rewarding its shareholders. However, investors should continue to monitor these metrics and consider them in their investment decisions.
GuruFocus Premium users can screen for high-dividend yield stocks using the High Dividend Yield Screener.
This article first appeared on GuruFocus.
