Matson Inc's Dividend Analysis
An In-Depth Look at Matson Inc's Dividend Sustainability and Prospects
Matson Inc (NYSE:MATX) recently announced a dividend of $0.32 per share, payable on 2024-03-07, with the ex-dividend date set for 2024-02-07. 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 Matson Inc's dividend performance and assess its sustainability.
What Does Matson Inc Do?
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Matson Inc is engaged in providing ocean transportation and logistics services. The business segments of the company are ocean transportation which provides ocean freight transportation services to the domestic non-contiguous economies of Hawaii, Alaska, California, Okinawa, and different islands in the South Pacific, and logistics which offers long haul and regional highway trucking services, warehousing and distribution services, supply chain management, and freight forwarding services. The firm generates the majority of its revenue from ocean transportation.
A Glimpse at Matson Inc's Dividend History
Matson Inc has maintained a consistent dividend payment record since 1985. Dividends are currently distributed on a quarterly basis. Matson Inc has increased its dividend each year since 2013. The stock is thus listed as a dividend achiever, an honor that is given to companies that have increased their dividend each year for at least the past 11 years. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Matson Inc's Dividend Yield and Growth
As of today, Matson Inc currently has a 12-month trailing dividend yield of 1.10% and a 12-month forward dividend yield of 1.12%. This suggests an expectation of increased dividend payments over the next 12 months. Over the past three years, Matson Inc's annual dividend growth rate was 12.40%. Extended to a five-year horizon, this rate decreased to 9.10% per year. And over the past decade, Matson Inc's annual dividends per share growth rate stands at 4.60%. Based on Matson Inc's dividend yield and five-year growth rate, the 5-year yield on cost of Matson Inc stock as of today is approximately 1.70%.
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 2023-12-31, Matson Inc's dividend payout ratio is 0.15. Matson Inc's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Matson Inc's profitability 9 out of 10 as of 2023-12-31, suggesting good profitability prospects. The company has reported positive net income for each year over the past decade, further solidifying its high profitability.
Growth Metrics: The Future Outlook
To ensure the sustainability of dividends, a company must have robust growth metrics. Matson Inc's growth rank of 9 out of 10 suggests that the company's growth trajectory is good relative to its competitors. Revenue is the lifeblood of any company, and Matson Inc's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Matson Inc's revenue has increased by approximately 29.50% per year on average, a rate that outperforms approximately 87.55% 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, Matson Inc's earnings increased by approximately 142.00% per year on average, a rate that outperforms approximately 94.45% of global competitors. Lastly, the company's 5-year EBITDA growth rate of 55.10%, which outperforms approximately 91.43% of global competitors.
Investor Takeaways
The consistent dividend history, robust yield, and growth rates of Matson Inc offer investors a compelling case for consideration. With a low payout ratio and high profitability rank, Matson Inc demonstrates a strong financial position to sustain and potentially grow its dividends. Furthermore, impressive growth metrics signal a positive outlook for the company's future performance. Investors seeking dividend income with growth potential may find Matson Inc an attractive option. GuruFocus Premium users can screen for high-dividend yield stocks using the High Dividend Yield Screener to explore similar investment 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.
