Ferrovial SE's Dividend Analysis
A Comprehensive Examination of Dividend Performance and Sustainability
Ferrovial SE (FERVF) recently announced a dividend of $0.43 per share, payable on 2023-11-22, with the ex-dividend date set for 2023-10-25. 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 Ferrovial SE's dividend performance and assess its sustainability.
What Does Ferrovial SE Do?
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Ferrovial SE is a Spanish industrial company. The company organizes itself into four segments: Toll Roads, Airports, Construction, and Energy and mobility infrastructures. The Toll Roads segment develops and operates toll roads globally. The Airports segment operates four airports in the United Kingdom, Heathrow, Aberdeen, Glasgow, and Southampton. The Construction segment designs and constructs buildings, transport infrastructure, water projects, and completes civil engineering work. The Energy and mobility infrastructures segment includes the operation of infrastructure for transport, natural resources, utilities, telecommunications, and waste collection and treatment. By country, the USA represents the maximum contribution to revenue, followed by Poland operations.
A Glimpse at Ferrovial SE's Dividend History
Ferrovial SE has maintained a consistent dividend payment record since 2005. Dividends are currently distributed on a bi-annually basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Ferrovial SE's Dividend Yield and Growth
As of today, Ferrovial SE currently has a 12-month trailing dividend yield of 2.15% and a 12-month forward dividend yield of 2.21%. This suggests an expectation of increased dividend payments over the next 12 months.
Over the past three years, Ferrovial SE's annual dividend growth rate was -1.30%. Extended to a five-year horizon, this rate decreased to -4.50% per year. Over the past decade, Ferrovial SE's annual dividends per share growth rate stands at -4.20%. Based on Ferrovial SE's dividend yield and five-year growth rate, the 5-year yield on cost of Ferrovial SE stock as of today is approximately 1.71%.
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, Ferrovial SE's dividend payout ratio is 2.81, suggesting that the company's dividend may not be sustainable.
Ferrovial SE's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Ferrovial SE's profitability 6 out of 10 as of 2023-06-30, suggesting fair profitability. The company has reported net profit in 8 years out of the past 10 years.
Growth Metrics: The Future Outlook
To ensure the sustainability of dividends, a company must have robust growth metrics. Ferrovial SE'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 Ferrovial SE's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Ferrovial SE's revenue has increased by approximately 8.90% per year on average, a rate that outperforms approximately 68.15% 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, Ferrovial SE's earnings increased by approximately -34.30% per year on average, a rate that outperforms approximately 12% of global competitors.
Next Steps
In conclusion, while Ferrovial SE has a consistent history of dividend payments, its payout ratio and negative growth rates raise questions about the sustainability of its dividends. However, its strong revenue growth and profitability rank paint a promising picture for the future. Investors should closely monitor these factors and consider them in their decision-making process. 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.
