Prologis Inc's Dividend Analysis
Understanding the Dividend Profile of Prologis Inc
Prologis Inc (NYSE:PLD) recently announced a dividend of $0.96 per share, payable on 2024-03-29, with the ex-dividend date set for 2024-03-15. 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 Prologis Inc's dividend performance and assess its sustainability.
What Does Prologis Inc Do?
This Powerful Chart Made Peter Lynch 29% A Year For 13 Years
How to calculate the intrinsic value of a stock?
Prologis was formed by the June 2011 merger of AMB Property and Prologis Trust. The company develops, acquires, and operates around 1.2 billion square feet of high-quality industrial and logistics facilities across the globe. The company also has a strategic capital business segment that has around $60 billion of third-party AUM. The company is organized into four global divisions (Americas, Europe, Asia, and other Americas) and operates as a real estate investment trust.
A Glimpse at Prologis Inc's Dividend History
Prologis Inc has maintained a consistent dividend payment record since 1997, with dividends currently distributed on a quarterly basis. Prologis Inc has increased its dividend each year since 2009. 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 15 years. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Prologis Inc's Dividend Yield and Growth
As of today, Prologis Inc currently has a 12-month trailing dividend yield of 2.62% and a 12-month forward dividend yield of 2.88%. This suggests an expectation of increased dividend payments over the next 12 months.
Over the past three years, Prologis Inc's annual dividend growth rate was 14.50%. Extended to a five-year horizon, this rate decreased to 12.90% per year. And over the past decade, Prologis Inc's annual dividends per share growth rate stands at an impressive 11.00%.
Based on Prologis Inc's dividend yield and five-year growth rate, the 5-year yield on cost of Prologis Inc stock as of today is approximately 4.81%.
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, Prologis Inc's dividend payout ratio is 1.35, which may suggest that the company's dividend may not be sustainable.
Prologis Inc's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Prologis 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. Prologis Inc's growth rank of 9 out of 10 suggests that the company's growth trajectory is good relative to its competitors.
Prologis Inc's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Prologis Inc's revenue has increased by approximately 12.70% per year on average, outperforming approximately 83.54% 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, Prologis Inc's earnings increased by approximately 18.20% per year on average, outperforming approximately 71.56% of global competitors.
Lastly, the company's 5-year EBITDA growth rate of 17.80%, outperforms approximately 85.19% of global competitors.
Next Steps
In conclusion, Prologis Inc's consistent dividend growth, sustainable payout ratio, strong profitability, and robust growth metrics present an attractive profile for value investors. The company's forward-looking indicators suggest a commitment to rewarding shareholders through dividends. However, investors should keep an eye on the payout ratio and growth prospects to ensure long-term dividend sustainability. With Prologis Inc's next dividend payment on the horizon, value investors may consider this as an opportunity to engage with a company that has demonstrated a reliable track record and promising future outlook.
GuruFocus Premium users can screen for 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.
