Embotelladora Andina SA's Dividend Analysis
An In-depth Look at the Company's Dividend Performance and Sustainability
Embotelladora Andina SA (NYSE:AKO.B) recently announced a dividend of $0.21 per share, payable on 0000-00-00, with the ex-dividend date set for 2023-10-19. 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 delve into Embotelladora Andina SA's dividend performance and assess its sustainability.
What Does Embotelladora Andina SA Do?
This Powerful Chart Made Peter Lynch 29% A Year For 13 Years
How to calculate the intrinsic value of a stock?
Embotelladora Andina SA is a Coca-Cola bottler in Latin America that produces carbonated soft drinks, water, fruit juices, energy drinks, and sports drinks that it sells under various Coca-Cola brands. Its geographic segment includes Chile, Brazil, Argentina, and Paraguay. The company also sells non-Coca-Cola branded teas, juices, beers, and spirits.
A Glimpse at Embotelladora Andina SA's Dividend History
Embotelladora Andina SA has maintained a consistent dividend payment record since 1997. Dividends are currently distributed on a quarterly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Embotelladora Andina SA's Dividend Yield and Growth
As of today, Embotelladora Andina SA currently has a 12-month trailing dividend yield of 8.86% and a 12-month forward dividend yield of 8.58%. This suggests an expectation of decreased dividend payments over the next 12 months.
Embotelladora Andina SA's dividend yield of 8.86% is near a 10-year high and outperforms 97.14% of global competitors in the Beverages - Non-Alcoholic industry, suggesting that the company's dividend yield stands out as an attractive proposition for income investors.
Over the past three years, Embotelladora Andina SA's annual dividend growth rate was 10.50%. Extended to a five-year horizon, this rate decreased to 8.80% per year. And over the past decade, Embotelladora Andina SA's annual dividends per share growth rate stands at an impressive 12.00%.
Based on Embotelladora Andina SA's dividend yield and five-year growth rate, the 5-year yield on cost of Embotelladora Andina SA stock as of today is approximately 13.51%.
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 2023-06-30, Embotelladora Andina SA's dividend payout ratio is 1.55. This may suggest that the company's dividend may not be sustainable.
Embotelladora Andina SA's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Embotelladora Andina SA'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.
Growth Metrics: The Future Outlook
To ensure the sustainability of dividends, a company must have robust growth metrics. Embotelladora Andina SA'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 Embotelladora Andina SA's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Embotelladora Andina SA's revenue has increased by approximately 14.30% per year on average, a rate that outperforms approximately 81.05% 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, Embotelladora Andina SA's earnings increased by approximately -10.30% per year on average, a rate that outperforms approximately 23.53% of global competitors.
Lastly, the company's 5-year EBITDA growth rate of 4.00%, which outperforms approximately 43.75% of global competitors.
Next Steps
In conclusion, Embotelladora Andina SA's consistent dividend payments, impressive dividend growth rate, and strong profitability and growth metrics make it an attractive proposition for income investors. However, its high payout ratio raises concerns about the sustainability of its dividend. Therefore, investors should carefully consider these factors before making an investment decision. 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.
