Public Service Enterprise Group Inc's Dividend Analysis
Unpacking the Dividend Profile of Public Service Enterprise Group Inc
Public Service Enterprise Group Inc (NYSE:PEG) recently announced a dividend of $0.57 per share, payable on 2023-12-29, with the ex-dividend date set for 2023-12-07. 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 Public Service Enterprise Group Inc's dividend performance and assess its sustainability.
What Does Public Service Enterprise Group Inc Do?
This Powerful Chart Made Peter Lynch 29% A Year For 13 Years
How to calculate the intrinsic value of a stock?
Public Service Enterprise Group is the holding company for a regulated utility (PSE&G) and other nonregulated businesses such as nuclear power generation and clean energy projects. PSE&G provides regulated gas and electricity delivery services in New Jersey to a combined 4 million customers. Public Service Enterprise Group also operates the Long Island Power Authority system. In 2022, the company sold its gas and oil power plants in the Mid-Atlantic, New York, and the Northeast.
A Glimpse at Public Service Enterprise Group Inc's Dividend History
Public Service Enterprise Group Inc has maintained a consistent dividend payment record since 1986. Dividends are currently distributed on a quarterly basis. Public Service Enterprise Group Inc has increased its dividend each year since 1986. The stock is thus listed as a dividend aristocrat, an honor that is given to companies that have increased their dividend each year for at least the past 37 years. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Public Service Enterprise Group Inc's Dividend Yield and Growth
As of today, Public Service Enterprise Group Inc currently has a 12-month trailing dividend yield of 3.59% and a 12-month forward dividend yield of 3.63%. This suggests an expectation of increased dividend payments over the next 12 months.
Over the past three years, Public Service Enterprise Group Inc's annual dividend growth rate was 4.70%. Extended to a five-year horizon, this rate decreased to 4.60% per year. And over the past decade, Public Service Enterprise Group Inc's annual dividends per share growth rate stands at 4.50%. Based on Public Service Enterprise Group Inc's dividend yield and five-year growth rate, the 5-year yield on cost of Public Service Enterprise Group Inc stock as of today is approximately 4.50%.
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, Public Service Enterprise Group Inc's dividend payout ratio is 0.40.
Public Service Enterprise Group Inc's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Public Service Enterprise Group Inc's profitability 7 out of 10 as of 2023-09-30, suggesting good profitability prospects. The company has reported net profit in 9 years out of the past 10 years.
Growth Metrics: The Future Outlook
To ensure the sustainability of dividends, a company must have robust growth metrics. Public Service Enterprise Group Inc's growth rank of 7 out of 10 suggests that the company's growth trajectory is good relative to its competitors.
Revenue is the lifeblood of any company, and Public Service Enterprise Group Inc's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Public Service Enterprise Group Inc's revenue has increased by approximately -0.50% per year on average, a rate that underperforms than approximately 82.75% 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, Public Service Enterprise Group Inc's earnings increased by approximately -9.40% per year on average, a rate that underperforms than approximately 73.64% of global competitors.
Lastly, the company's 5-year EBITDA growth rate of -4.20%, which underperforms than approximately 76.97% of global competitors.
Concluding Insights on Public Service Enterprise Group Inc's Dividend Profile
While Public Service Enterprise Group Inc has a commendable history of dividend payments and modest growth rates, the company's recent performance in revenue and earnings growth presents a mixed picture. The sustainability of its dividends, supported by a reasonable payout ratio and good profitability rank, appears stable for the near term. However, investors may wish to monitor the company's growth metrics closely, as they could impact dividend sustainability in the longer run. For those seeking to expand their portfolio with dividend-paying stocks, 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.
