Rockwell Automation Inc's Dividend Analysis
Unveiling the Dividend Dynamics of Rockwell Automation Inc
Rockwell Automation Inc (NYSE:ROK) recently announced a dividend of $1.25 per share, payable on 2024-03-11, with the ex-dividend date set for 2024-02-16. 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 Rockwell Automation Inc's dividend performance and assess its sustainability.
What Does Rockwell Automation Inc Do?
This Powerful Chart Made Peter Lynch 29% A Year For 13 Years
How to calculate the intrinsic value of a stock?
Rockwell Automation is a pure-play automation competitor that is the successor entity to Rockwell International, which spun off its former Rockwell Collins avionics segment in 2001. As of fiscal 2021, the firm operates through three segments--intelligent devices, software and control, and lifecycle services. Intelligent devices contains its drives, sensors, and industrial components, software and control contains its information and network and security software, while lifecycle services contains its consulting and maintenance services as well as its Sensia JV with SLB.
A Glimpse at Rockwell Automation Inc's Dividend History
Rockwell Automation Inc has maintained a consistent dividend payment record since 1986. Dividends are currently distributed on a quarterly basis.
Rockwell Automation Inc has increased its dividend each year since 2002. 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 22 years. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Rockwell Automation Inc's Dividend Yield and Growth
As of today, Rockwell Automation Inc currently has a 12-month trailing dividend yield of 1.71% and a 12-month forward dividend yield of 1.79%. This suggests an expectation of increased dividend payments over the next 12 months.
Over the past three years, Rockwell Automation Inc's annual dividend growth rate was 5.00%. Extended to a five-year horizon, this rate increased to 5.80% per year. And over the past decade, Rockwell Automation Inc's annual dividends per share growth rate stands at 8.90%.
Based on Rockwell Automation Inc's dividend yield and five-year growth rate, the 5-year yield on cost of Rockwell Automation Inc stock as of today is approximately 2.27%.
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, Rockwell Automation Inc's dividend payout ratio is 0.41.
Rockwell Automation Inc's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Rockwell Automation 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 of 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. Rockwell Automation 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 Rockwell Automation Inc's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Rockwell Automation Inc's revenue has increased by approximately 13.00% per year on average, a rate that outperforms approximately 67.13% 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, Rockwell Automation Inc's earnings increased by approximately 15.50% per year on average, a rate that outperforms approximately 56.35% of global competitors.
Lastly, the company's 5-year EBITDA growth rate of 7.20%, which outperforms approximately 47.83% of global competitors.
Next Steps
Considering Rockwell Automation Inc's robust dividend payments, consistent dividend growth rate, manageable payout ratio, strong profitability, and promising growth metrics, investors may view the company as a potentially attractive option for dividend income. The commitment to returning value to shareholders, along with a solid financial foundation, positions Rockwell Automation Inc favorably for future dividend sustainability and growth.
For those seeking to diversify their portfolio with high-dividend yield stocks, GuruFocus Premium users can leverage the High Dividend Yield Screener to identify other companies with similar dividend profiles.
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.
