International Game Technology PLC's Dividend Analysis
Understanding IGT's Dividend Payout and Financial Health
International Game Technology PLC (NYSE:IGT) recently announced a dividend of $0.20 per share, payable on 2023-12-13, with the ex-dividend date set for 2023-11-28. 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 look into International Game Technology PLC's dividend performance and assess its sustainability.
What Does International Game Technology PLC Do?
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International Game Technology PLC is a gaming company that delivers entertaining and responsible gaming experiences for players across all channels and segments. With a focus on Global Lottery, Global Gaming, and Digital & Betting, IGT generates maximum revenue from the Global Lottery segment. This segment provides a comprehensive range of lottery products and services to governmental organizations. Geographically, the majority of revenue is derived from the United States, making IGT a significant player in the gaming and lottery industry.
A Glimpse at International Game Technology PLC's Dividend History
International Game Technology PLC has maintained a consistent dividend payment record since 2014, distributing dividends on a quarterly basis. This history reflects IGT's commitment to returning value to shareholders. Below is a chart showing annual Dividends Per Share to track historical trends.
Breaking Down International Game Technology PLC's Dividend Yield and Growth
As of today, International Game Technology PLC currently has a 12-month trailing dividend yield of 2.94% and a 12-month forward dividend yield of 2.94%, indicating expectations of consistent dividend payments over the next year. However, looking at a five-year horizon, the dividend growth rate has decreased to -14.70% per year, which raises questions about long-term sustainability. The 5-year yield on cost for IGT stock is approximately 1.33% 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. International Game Technology PLC's dividend payout ratio is 1.60 as of 2023-09-30, which may suggest concerns regarding the sustainability of the company's dividends. Moreover, IGT's profitability rank is 6 out of 10, indicating fair profitability with a history of net profit in 5 of the past 10 years.
Growth Metrics: The Future Outlook
For dividends to be sustainable, a company must exhibit robust growth metrics. International Game Technology PLC's growth rank of 6 suggests a fair growth outlook. The company's revenue per share and 3-year revenue growth rate indicate a strong revenue model, with an average annual increase of approximately 1.70%, outperforming approximately 57.09% of global competitors.
Concluding Thoughts on IGT's Dividend Prospects
In conclusion, while International Game Technology PLC presents a consistent dividend history and a fair current yield, the negative five-year dividend growth rate and payout ratio raise concerns about the long-term sustainability of its dividends. However, the company's fair profitability and growth metrics provide a balanced perspective. Investors should consider these factors in the context of their personal investment strategy and the broader market environment. For those seeking high-dividend yield stocks, GuruFocus Premium users can utilize the High Dividend Yield Screener to find potential 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.
