Equity Lifestyle Properties Inc: A Deep Dive into Its Dividend Performance and Sustainability
A Comprehensive Analysis of Equity Lifestyle Properties Inc's Dividend History, Yield, Growth, and Future Prospects
Equity Lifestyle Properties Inc (NYSE:ELS) recently announced a dividend of $0.45 per share, payable on 2023-10-13, 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 Equity Lifestyle Properties Inc's dividend performance and assess its sustainability.
Understanding Equity Lifestyle Properties Inc
Warning! GuruFocus has detected 8 Warning Signs with ELS. Click here to check it out.
This Powerful Chart Made Peter Lynch 29% A Year For 13 Years
How to calculate the intrinsic value of a stock?
Equity Lifestyle Properties is a residential REIT that focuses on owning manufactured housing, residential vehicle communities, and marinas. The company currently has a portfolio of 450 properties across the U.S. with a higher concentration in the Sunbelt region with 34% of the company's properties located in Florida, 11% in California, and 10% in Arizona. Equity Lifestyle targets owning properties in attractive retirement destinations with over 70% of the company's properties either being age-restricted or having an average resident age over 55.
Equity Lifestyle Properties Inc's Dividend History
Equity Lifestyle Properties Inc has maintained a consistent dividend payment record since 1993. Dividends are currently distributed on a quarterly basis. Equity Lifestyle Properties Inc has increased its dividend each year since 2004. 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 19 years.
Breaking Down Equity Lifestyle Properties Inc's Dividend Yield and Growth
As of today, Equity Lifestyle Properties Inc currently has a 12-month trailing dividend yield of 2.68% and a 12-month forward dividend yield of 2.81%. This suggests an expectation of increased dividend payments over the next 12 months.
Over the past three years, Equity Lifestyle Properties Inc's annual dividend growth rate was 10.20%. Extended to a five-year horizon, this rate increased to 10.70% per year. And over the past decade, Equity Lifestyle Properties Inc's annual dividends per share growth rate stands at an impressive 13.90%.
Based on Equity Lifestyle Properties Inc's dividend yield and five-year growth rate, the 5-year yield on cost of Equity Lifestyle Properties Inc stock as of today is approximately 4.46%.
Assessing 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, Equity Lifestyle Properties Inc's dividend payout ratio is 1.12. This may suggest that the company's dividend may not be sustainable.
Equity Lifestyle Properties Inc's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Equity Lifestyle Properties Inc's profitability 9 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.
Equity Lifestyle Properties Inc's Growth Metrics and Future Outlook
To ensure the sustainability of dividends, a company must have robust growth metrics. Equity Lifestyle Properties Inc's growth rank of 9 out of 10 suggests that the company's growth trajectory is good relative to its competitors.
Revenue is the lifeblood of any company, and Equity Lifestyle Properties Inc's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Equity Lifestyle Properties Inc's revenue has increased by approximately 11.30% per year on average, a rate that outperforms approximately 85.22% 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, Equity Lifestyle Properties Inc's earnings increased by approximately -0.20% per year on average, a rate that outperforms approximately 43.71% of global competitors.
Lastly, the company's 5-year EBITDA growth rate of 6.10%, outperforms approximately 56.06% of global competitors.
Conclusion: Equity Lifestyle Properties Inc's Dividend Sustainability and Growth Prospects
Equity Lifestyle Properties Inc's consistent dividend payment history, impressive yield, and robust growth rates make it a compelling choice for dividend investors. However, the high payout ratio indicates a potential risk to dividend sustainability. Despite this, the company's strong profitability and growth metrics suggest that it could maintain its dividend payments in the long run. As always, investors are advised to conduct their own comprehensive analysis before making investment decisions.
GuruFocus Premium users can screen for high-dividend yield stocks using the High Dividend Yield Screener.
This article first appeared on GuruFocus.
