Freeport-McMoRan Inc's Dividend Analysis
Assessing the Upcoming Dividend Payout and Company's Financial Health
Freeport-McMoRan Inc (NYSE:FCX) recently announced a dividend of $0.15 per share, payable on 2024-02-01, with the ex-dividend date set for 2024-01-11. 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 Freeport-McMoRan Inc's dividend performance and assess its sustainability.
What Does Freeport-McMoRan Inc Do?
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Freeport-McMoRan Inc is an international mining company. It operates geographically diverse assets with proven and probable mineral reserves of copper, gold, and molybdenum. The company's portfolio of assets includes the Grasberg minerals district in Indonesia; and mining operations in North America and South America, including the large-scale Morenci minerals district in Arizona and the Cerro Verde operation in Peru. Its key revenue is derived from the sale of copper.
A Glimpse at Freeport-McMoRan Inc's Dividend History
Freeport-McMoRan Inc has maintained a consistent dividend payment record since 2018. Dividends are currently distributed on a quarterly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Freeport-McMoRan Inc's Dividend Yield and Growth
As of today, Freeport-McMoRan Inc currently has a 12-month trailing dividend yield of 1.44% and a 12-month forward dividend yield of 1.44%. This suggests an expectation of the same dividend payments over the next 12 months. Over the past three years, Freeport-McMoRan Inc's annual dividend growth rate was 44.20%. Based on Freeport-McMoRan Inc's dividend yield and five-year growth rate, the 5-year yield on cost of Freeport-McMoRan Inc stock as of today is approximately 1.44%.
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, Freeport-McMoRan Inc's dividend payout ratio is 0.40. Freeport-McMoRan Inc's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Freeport-McMoRan Inc's profitability 7 out of 10 as of 2023-09-30, suggesting good profitability prospects. The company has reported net profit in 6 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. Freeport-McMoRan Inc'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 Freeport-McMoRan Inc's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Freeport-McMoRan Inc's revenue has increased by approximately 16.50% per year on average, a rate that outperforms approximately 61.8% of global competitors.
Concluding Thoughts on Freeport-McMoRan Inc's Dividend Prospects
In conclusion, Freeport-McMoRan Inc's upcoming dividend, consistent dividend growth, manageable payout ratio, and strong profitability and growth metrics paint a picture of a company that is committed to rewarding shareholders while maintaining a focus on its financial health. As Freeport-McMoRan Inc continues to navigate the dynamic mining industry, it remains an interesting prospect for value investors seeking stable dividend income. Will the company continue its trend of dividend growth and maintain its competitive edge in the market? Only time will tell, but the indicators suggest that Freeport-McMoRan Inc is on a solid path. For those interested in further exploring such investment opportunities, 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.
