Essex Property Trust Inc's Dividend Analysis
Assessing the Upcoming Dividend and Financial Health of ESS
Essex Property Trust Inc (NYSE:ESS) recently announced a dividend of $2.31 per share, payable on 2024-01-12, with the ex-dividend date set for 2023-12-29. 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 Essex Property Trust Inc's dividend performance and assess its sustainability.
What Does Essex Property Trust Inc Do?
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Essex Property Trust owns a portfolio of 252 apartment communities with over 62,000 units and is developing another property with 264 units. The company focuses on owning large, high-quality properties on the West Coast in the urban and suburban submarkets of Southern California, Northern California, and Seattle.
A Glimpse at Essex Property Trust Inc's Dividend History
Essex Property Trust Inc has maintained a consistent dividend payment record since 1994, distributing dividends quarterly. The company has also increased its dividend annually since 1994, earning it the status of a dividend aristocrat, a title reserved for companies with at least 29 consecutive years of dividend increases. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Essex Property Trust Inc's Dividend Yield and Growth
As of today, Essex Property Trust Inc currently has a 12-month trailing dividend yield of 3.64% and a 12-month forward dividend yield of 3.68%, indicating anticipated dividend increases over the next year. Over the past three years, Essex Property Trust Inc's annual dividend growth rate was 4.10%, which expanded to 4.60% over a five-year period, and reached 7.40% over the past decade. The 5-year yield on cost for Essex Property Trust Inc stock is approximately 4.56% as of today.
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 reflects the portion of earnings distributed as dividends. As of 2023-09-30, Essex Property Trust Inc's dividend payout ratio is 1.12, which could raise concerns about dividend sustainability. However, Essex Property Trust Inc's profitability rank is 8 out of 10 as of 2023-09-30, indicating good profitability prospects. The company has also reported positive net income annually for the past decade, reinforcing its strong financial position.
Growth Metrics: The Future Outlook
Essex Property Trust Inc's growth rank of 8 out of 10 suggests a positive growth trajectory relative to competitors. The company's revenue per share and 3-year revenue growth rate of 3.70% per year outperform approximately 62.95% of global competitors. However, the 3-year EPS growth rate shows an average annual decrease of -8.70%, which still outperforms about 30.47% of global competitors. The 5-year EBITDA growth rate of -1.00% also outperforms approximately 42.49% of global competitors, presenting a mixed but overall strong growth perspective.
Next Steps for Investors
In conclusion, Essex Property Trust Inc's consistent dividend payment history, status as a dividend aristocrat, and solid dividend growth rates are attractive features for value investors. While the high payout ratio may raise some concerns, the company's strong profitability and good growth metrics provide reassurance about the potential sustainability of dividends. Investors should also consider the company's ability to maintain positive net income and its favorable growth rank when evaluating its long-term dividend prospects. For those seeking high-dividend yield investments, GuruFocus Premium offers tools such as the High Dividend Yield Screener to discover similar investment opportunities.
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.
