Motorola Solutions Inc's Dividend Analysis
Insight into Motorola Solutions Inc's Upcoming Dividend and Its Historical Performance
Motorola Solutions Inc (NYSE:MSI) recently announced a dividend of $0.98 per share, payable on 2024-01-12, with the ex-dividend date set for 2023-12-14. 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 Motorola Solutions Inc's dividend performance and assess its sustainability.
What Does Motorola Solutions Inc Do?
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Motorola Solutions is a leading provider of communications and analytics, primarily serving public safety departments as well as schools, hospitals, and businesses. The bulk of the firm's revenue comes from sales of land mobile radios and radio network infrastructure, but the firm also sells surveillance equipment and dispatch software. Most of Motorola's revenue comes from government agencies, while roughly 25% comes from schools and private businesses. Motorola has customers in over 100 countries and in every state in the United States.
A Glimpse at Motorola Solutions Inc's Dividend History
Motorola Solutions Inc has maintained a consistent dividend payment record since 2011. Dividends are currently distributed on a quarterly basis. Motorola Solutions Inc has increased its dividend each year since 2011. 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 12 years. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Motorola Solutions Inc's Dividend Yield and Growth
As of today, Motorola Solutions Inc currently has a 12-month trailing dividend yield of 1.08% and a 12-month forward dividend yield of 1.20%. This suggests an expectation of increased dividend payments over the next 12 months.
Motorola Solutions Inc's dividend yield of 1.08% is near a 10-year low and underperforms than 73.78% of global competitors in the Hardware industry, suggesting that the company's dividend yield may not be a compelling proposition for income investors.
Over the past three years, Motorola Solutions Inc's annual dividend growth rate was 11.40%. Extended to a five-year horizon, this rate decreased to 11.00% per year. And over the past decade, Motorola Solutions Inc's annual dividends per share growth rate stands at an impressive 12.70%.
Based on Motorola Solutions Inc's dividend yield and five-year growth rate, the 5-year yield on cost of Motorola Solutions Inc stock as of today is approximately 1.82%.
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, Motorola Solutions Inc's dividend payout ratio is 0.36.
Motorola Solutions Inc's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Motorola Solutions Inc's profitability 8 out of 10 as of 2023-09-30, suggesting good profitability prospects. The company has reported net profit in 9 years out of past 10 years.
Growth Metrics: The Future Outlook
To ensure the sustainability of dividends, a company must have robust growth metrics. Motorola Solutions Inc's growth rank of 8 out of 10 suggests that the company's growth trajectory is good relative to its competitors.
Revenue is the lifeblood of any company, and Motorola Solutions Inc's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Motorola Solutions Inc's revenue has increased by approximately 5.70% per year on average, a rate that outperforms than approximately 53.89% 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, Motorola Solutions Inc's earnings increased by approximately 5.30% per year on average, a rate that outperforms than approximately 38.03% of global competitors.
Engaging Conclusion: Motorola Solutions Inc's Dividend Prospects
In conclusion, Motorola Solutions Inc's consistent dividend payments, along with its strong dividend growth rate, suggest a commitment to returning value to shareholders. The company's prudent payout ratio and high profitability rank indicate that its dividend is sustainable. Furthermore, the robust growth metrics paint a promising future, which could mean continued dividend increases. Investors seeking dividend income and growth should consider the potential of Motorola Solutions Inc as part of their investment portfolios. Will Motorola Solutions Inc maintain its dividend achiever status in the years to come?
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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.
