LyondellBasell Industries NV's Dividend Analysis
Assessing the Sustainability and Growth of LYB's Dividend
LyondellBasell Industries NV (NYSE:LYB) recently announced a dividend of $1.25 per share, payable on 2023-12-04, with the ex-dividend date set for 2023-11-24. 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 LyondellBasell Industries NV's dividend performance and assess its sustainability.
What Does LyondellBasell Industries NV Do?
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LyondellBasell Industries NV is a leading petrochemical producer with a significant presence in the United States, Europe, and Asia. Known as the world's largest producer of polypropylene, LyondellBasell Industries NV also stands out as a major supplier of polyethylene and propylene oxide. The chemicals produced by the company find widespread use across various consumer and industrial products, with a substantial portion of its production stemming from North American operations.
A Glimpse at LyondellBasell Industries NV's Dividend History
Since 2011, LyondellBasell Industries NV has upheld a steady track record of dividend payments, with distributions occurring quarterly. The company's commitment to increasing dividends annually since 2011 has earned it the title of a dividend achiever, a distinction reserved for companies with at least a 12-year history of consecutive dividend increases.
Below is a chart illustrating LyondellBasell Industries NV's annual Dividends Per Share, showcasing historical trends.
Breaking Down LyondellBasell Industries NV's Dividend Yield and Growth
LyondellBasell Industries NV currently boasts a 12-month trailing dividend yield of 5.15% and a forward dividend yield of 5.27%, indicating anticipated dividend hikes in the coming year.
Over the past three years, the company's annual dividend growth rate was 4.20%. This growth extends to 5.10% per annum over five years, with a remarkable 10-year growth rate of 10.70%. Consequently, the 5-year yield on cost for LyondellBasell Industries NV stock is approximately 6.60%.
The Sustainability Question: Payout Ratio and Profitability
The dividend payout ratio is a critical measure of dividend sustainability, reflecting the proportion of earnings paid out as dividends. LyondellBasell Industries NV's payout ratio stands at 0.70 as of 2023-09-30, which may raise concerns about the long-term viability of its dividend payments.
However, the company's profitability rank of 8 out of 10 signifies strong earnings potential. Consistent positive net income over the past decade underscores LyondellBasell Industries NV's robust profitability.
Growth Metrics: The Future Outlook
LyondellBasell Industries NV's growth rank of 8 suggests a favorable growth trajectory compared to its competitors. The company's revenue per share and 3-year revenue growth rate of 16.10% annually outperform 68.83% of global peers.
LyondellBasell Industries NV's 3-year EPS growth rate of 7.70% per annum surpasses 44.68% of global competitors. Additionally, the 5-year EBITDA growth rate of 1.70% outperforms 30.39% of its global counterparts.
Next Steps
Considering LyondellBasell Industries NV's consistent dividend growth, reasonable payout ratio, and solid profitability and growth metrics, the company's dividend payments appear to be on a sustainable path. However, investors should closely monitor the payout ratio and profitability to ensure that future dividends are well-supported by earnings. With the company's strong growth prospects, LyondellBasell Industries NV remains an attractive option for value investors seeking reliable dividend income.
For those seeking high-dividend yield opportunities, GuruFocus Premium users can utilize the High Dividend Yield Screener to discover similar investment prospects.
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.
