Dine Brands Global Inc's Dividend Analysis
Assessing the Future of Dine Brands Global Inc's Dividends
Dine Brands Global Inc (NYSE:DIN) recently announced a dividend of $0.51 per share, payable on 2024-01-05, with the ex-dividend date set for 2023-12-19. 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 look into Dine Brands Global Inc's dividend performance and assess its sustainability.
What Does Dine Brands Global Inc Do?
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Dine Brands Global Inc owns and franchises thousands of restaurants under the Applebee's and International House of Pancakes names. Almost all company restaurants are located in the United States and franchised. Royalty revenue, which the company gets from franchisees based on franchisees' sales, accounts for roughly three-quarters of total company revenue. The company also earns revenue by leasing restaurant sites to franchisees. The company has four reportable segments: Franchise operations, Rental operations, Financing operations, and Company-operated restaurant operations, with the majority of revenue derived from the Franchise operations segment.
A Glimpse at Dine Brands Global Inc's Dividend History
Dine Brands Global Inc has maintained a consistent dividend payment record since 2013, with dividends currently distributed on a quarterly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Dine Brands Global Inc's Dividend Yield and Growth
As of today, Dine Brands Global Inc currently has a 12-month trailing dividend yield of 4.13% and a 12-month forward dividend yield of 4.13%, suggesting an expectation of same dividend payments over the next 12 months. Over the past three years, Dine Brands Global Inc's annual dividend growth rate was -10.30%. Extended to a five-year horizon, this rate decreased to -25.20% per year. Based on Dine Brands Global Inc's dividend yield and five-year growth rate, the 5-year yield on cost of Dine Brands Global Inc stock as of today is approximately 0.97%.
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 2023-09-30, Dine Brands Global Inc's dividend payout ratio is 0.42. Dine Brands Global Inc's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Dine Brands Global Inc's profitability 7 out of 10 as of 2023-09-30, suggesting good profitability prospects. The company has reported net profit in 8 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. Dine Brands Global Inc'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 Dine Brands Global Inc's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Dine Brands Global Inc's revenue has increased by approximately 2.70% per year on average, outperforming approximately 60.86% 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, Dine Brands Global Inc's earnings increased by approximately -7.30% per year on average, outperforming approximately 34.05% of global competitors. Lastly, the company's 5-year EBITDA growth rate of -1.20%, which outperforms approximately 40.19% of global competitors.
Next Steps
In conclusion, while Dine Brands Global Inc has shown a fluctuating dividend growth rate, its solid dividend yield, manageable payout ratio, and good profitability rank indicate that its dividends have a strong foundation. The company's growth metrics, although mixed, suggest a capacity to maintain its dividend payments. Investors should consider these factors in the context of their personal investment strategy and the broader market environment. For those looking to expand their portfolio with income-generating stocks, 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.
