Diversified Healthcare Trust's Dividend Analysis
Assessing the Sustainability and Growth of DHC's Dividends
Diversified Healthcare Trust (NASDAQ:DHC) recently announced a dividend of $0.01 per share, payable on 0000-00-00, with the ex-dividend date set for 2024-01-19. 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 Diversified Healthcare Trust's dividend performance and assess its sustainability.
What Does Diversified Healthcare Trust Do?
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Diversified Healthcare Trust is a real estate investment trust that focuses on healthcare-related properties, including life science estates, medical offices, and senior living communities. It acquires and owns properties and is engaged in the development and implementation of medical services and technologies. It operates through two segments: its office portfolio and its senior housing operating portfolio. The office portfolio includes medical office properties leased to medical-related businesses and life sciences properties. The SHOP segment runs communities that offer multiple types of residential care, ranging from independent living to nursing services. Diversified Healthcare Trust operates across the United States and the majority of its revenue derives from rents and medical programs.
A Glimpse at Diversified Healthcare Trust's Dividend History
Diversified Healthcare Trust has maintained a consistent dividend payment record since 1999. Dividends are currently distributed on a quarterly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Diversified Healthcare Trust's Dividend Yield and Growth
As of today, Diversified Healthcare Trust currently has a 12-month trailing dividend yield of 1.46% and a 12-month forward dividend yield of 1.46%. This suggests an expectation of same dividend payments over the next 12 months.
Over the past three years, Diversified Healthcare Trust's annual dividend growth rate was -63.80%. Extended to a five-year horizon, this rate increased to -58.60% per year. And over the past decade, Diversified Healthcare Trust's annual dividends per share growth rate stands at -30.90%.
Based on Diversified Healthcare Trust's dividend yield and five-year growth rate, the 5-year yield on cost of Diversified Healthcare Trust stock as of today is approximately 0.02%.
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, Diversified Healthcare Trust's dividend payout ratio is 0.00.
Diversified Healthcare Trust's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Diversified Healthcare Trust's profitability 6 out of 10 as of 2023-09-30, suggesting fair profitability. The company has reported net profit in 7 years out of past 10 years.
Growth Metrics: The Future Outlook
To ensure the sustainability of dividends, a company must have robust growth metrics. Diversified Healthcare Trust'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 Diversified Healthcare Trust's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Diversified Healthcare Trust's revenue has increased by approximately 7.20% per year on average, a rate that outperforms approximately 74.76% of global competitors.
Concluding Thoughts on Diversified Healthcare Trust's Dividends
In conclusion, while Diversified Healthcare Trust's dividend growth rate has seen a decline over the past years, the company's solid revenue growth and fair profitability rank may provide some reassurance to investors regarding the sustainability of its dividends. The current low dividend yield and yield on cost, however, may not appeal to those seeking high income from their investments. Investors should weigh these factors along with the company's growth prospects and payout ratio when considering Diversified Healthcare Trust as a potential addition to their dividend portfolios. For those looking for high-dividend yield opportunities, GuruFocus Premium users can utilize the High Dividend Yield Screener to find stocks that better fit their investment criteria.
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.
