DTE Energy Co's Dividend Analysis
Assessing the Upcoming Dividend Payment and Historical Performance
DTE Energy Co (NYSE:DTE) recently announced a dividend of $1.02 per share, payable on 2024-01-15, with the ex-dividend date set for 2023-12-15. 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 DTE Energy Co's dividend performance and assess its sustainability.
What Does DTE Energy Co Do?
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DTE Energy Co operates as a diversified energy company, primarily engaged in the development and management of energy-related businesses and services nationwide. DTE Energy owns two regulated utilities in Michigan that contribute 90% of earnings. DTE Electric serves approximately 2.3 million customers in southeastern Michigan, including Detroit. DTE Gas serves 1.3 million customers throughout the state. In addition, DTE Energy has nonutility businesses and investments including energy marketing and trading, renewable natural gas facilities, and on-site industrial energy projects.
A Glimpse at DTE Energy Co's Dividend History
DTE Energy Co has maintained a consistent dividend payment record since 1985, showcasing its commitment to returning value to shareholders. Dividends are currently distributed on a quarterly basis, reinforcing the company's financial stability and investor-friendly approach.
Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down DTE Energy Co's Dividend Yield and Growth
As of today, DTE Energy Co currently has a 12-month trailing dividend yield of 3.35% and a 12-month forward dividend yield of 3.40%. This suggests an expectation of increased dividend payments over the next 12 months.
Over the past three years, DTE Energy Co's annual dividend growth rate was -2.10%. Extended to a five-year horizon, this rate increased to 1.90% per year. And over the past decade, DTE Energy Co's annual dividends per share growth rate stands at 5.30%.
Based on DTE Energy Co's dividend yield and five-year growth rate, the 5-year yield on cost of DTE Energy Co stock as of today is approximately 3.68%.
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, DTE Energy Co's dividend payout ratio is 0.63.
DTE Energy Co's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks DTE Energy Co's profitability 7 out of 10 as of 2023-09-30, suggesting good profitability prospects. The company has reported positive net income for each year over the past decade, further solidifying its high profitability.
Growth Metrics: The Future Outlook
To ensure the sustainability of dividends, a company must have robust growth metrics. DTE Energy Co'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 DTE Energy Co's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. DTE Energy Co's revenue has increased by approximately 14.30% per year on average, a rate that outperforms approximately 72.78% 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, DTE Energy Co's earnings increased by approximately 7.70% per year on average, a rate that outperforms approximately 59.04% of global competitors.
Lastly, the company's 5-year EBITDA growth rate of -1.60%, which outperforms approximately 30.03% of global competitors.
Next Steps
In conclusion, DTE Energy Co's upcoming dividend, historical dividend growth, and payout ratio paint a picture of a company committed to shareholder returns. The robust profitability and positive growth metrics further bolster confidence in the sustainability of DTE Energy Co's dividends. As value investors consider the future prospects of DTE Energy Co, they can rely on GuruFocus for comprehensive data and analysis. With a forward-looking approach, DTE Energy Co appears well-positioned to continue its track record of dividend reliability and growth.
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.
