Johnson Controls International PLC's Dividend Analysis
Assessing the Sustainability and Growth of JCI's Dividends
Johnson Controls International PLC (NYSE:JCI) recently announced a dividend of $0.37 per share, payable on 2024-01-12, with the ex-dividend date set for 2023-12-15. 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 Johnson Controls International PLC's dividend performance and assess its sustainability.
What Does Johnson Controls International PLC Do?
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Johnson Controls International PLC operates in the building products industry, focusing on creating intelligent buildings, efficient energy solutions, and integrated infrastructure. It manufactures, installs, and services HVAC systems, building management systems and controls, industrial refrigeration systems, and fire and security solutions. Commercial HVAC accounts for about 40% of sales, fire and security represents another 40%, and residential HVAC, industrial refrigeration, and other solutions make up the remaining 20% of revenue. In fiscal 2022, Johnson Controls International PLC's operations generated over $25 billion in revenue, reflecting the company's significant market presence.
A Glimpse at Johnson Controls International PLC's Dividend History
Johnson Controls International PLC has upheld a steady dividend payment track record since 1985, demonstrating its commitment to delivering shareholder value. The dividends are distributed quarterly, allowing investors to benefit from a regular income stream. Below is a chart detailing the annual Dividends Per Share to track historical trends.
Breaking Down Johnson Controls International PLC's Dividend Yield and Growth
As of today, Johnson Controls International PLC boasts a 12-month trailing dividend yield of 2.74% and a 12-month forward dividend yield of 2.79%, indicating anticipated dividend increases over the next year. Over the past three years, JCI's annual dividend growth rate was 10.20%. This growth rate dips slightly to 5.10% per annum when extended to a five-year horizon, and to 4.00% over the past decade.
Based on Johnson Controls International PLC's dividend yield and five-year growth rate, the 5-year yield on cost of JCI stock as of today is approximately 3.51%.
The Sustainability Question: Payout Ratio and Profitability
To assess the sustainability of the dividend, one needs to evaluate the company's payout ratio. Johnson Controls International PLC's dividend payout ratio is currently at 0.48, which suggests a balance between distributing earnings to shareholders and retaining funds for future growth and stability. JCI's profitability rank of 7 out of 10 also indicates good profitability prospects, with the company reporting net profit in 9 out of the past 10 years.
Growth Metrics: The Future Outlook
Johnson Controls International PLC's robust growth rank of 7 out of 10 signals a positive growth trajectory compared to its competitors. Its strong revenue model is evidenced by a revenue per share and 3-year revenue growth rate that outperforms approximately 69.6% of global competitors. Additionally, JCI's 3-year EPS growth rate and 5-year EBITDA growth rate outperform approximately 72.95% and 82.49% of global competitors, respectively.
Conclusion: Evaluating Johnson Controls International PLC's Dividend Prospects
In conclusion, Johnson Controls International PLC's dividend payments, growth rate, payout ratio, and profitability and growth metrics paint a picture of a company that is committed to delivering shareholder value while maintaining a strong financial foundation. The consistent dividend history, coupled with a solid growth outlook, suggests that JCI is well-positioned to sustain and potentially increase its dividends in the future. Investors looking for stable dividend income as well as growth potential may find Johnson Controls International PLC an attractive option. Will JCI continue its trajectory of dividend growth, and how will the company's strategic initiatives influence its financial health? For further insights, GuruFocus Premium users can explore 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.
