Royal Gold Inc's Dividend Analysis
Assessing Royal Gold Inc's Dividend Sustainability and Growth
Royal Gold Inc (NASDAQ:RGLD) recently announced a dividend of $0.4 per share, payable on 2024-01-19, with the ex-dividend date set for 2024-01-04. 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 delve into Royal Gold Inc's dividend performance and evaluate its sustainability.
What Does Royal Gold Inc Do?
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Royal Gold Inc acquires and manages precious metal royalties and streams, with an emphasis on gold. The company's model involves purchasing a share of the metal produced from a mineral property for an initial payment, all while avoiding the responsibilities of mining operations. Through royalty and streaming agreements with mine operators, Royal Gold secures rights to purchase metals at an agreed price, contributing upfront capital. The company's portfolio spans across producing, development, evaluation, and exploration projects, primarily in Canada, Mexico, Chile, and the United States.
A Glimpse at Royal Gold Inc's Dividend History
Royal Gold Inc has a commendable history of consistent dividend payments, dating back to 2000, and has been increasing its dividend annually. This track record qualifies Royal Gold as a dividend achiever, a prestigious title awarded to companies with at least 24 consecutive years of dividend increases. Below is a chart that illustrates the historical trends of Royal Gold Inc's annual Dividends Per Share.
Breaking Down Royal Gold Inc's Dividend Yield and Growth
Royal Gold Inc boasts a trailing dividend yield of 1.25% and a forward dividend yield of 1.32%, indicating an anticipated increase in dividend payments over the next year. Over the past three years, the company's annual dividend growth rate was an impressive 10.90%, which slightly tapered to 7.70% over a five-year period, and settled at 7.30% over the past decade. Reflecting on these figures, the 5-year yield on cost for Royal Gold Inc stock is approximately 1.81%.
The Sustainability Question: Payout Ratio and Profitability
The dividend payout ratio is crucial for assessing the sustainability of Royal Gold Inc's dividends. With a payout ratio of 0.42 as of 2023-09-30, Royal Gold retains a significant portion of its earnings for future growth and to weather economic downturns. The company's profitability rank stands at 8 out of 10, indicating robust profitability compared to peers, with net profits reported in 8 of the past 10 years.
Growth Metrics: The Future Outlook
Royal Gold Inc's growth rank of 8 suggests a strong growth trajectory. The company's revenue per share and 3-year revenue growth rate indicate a solid revenue stream, outperforming 52.04% of global competitors. Additionally, the 3-year EPS growth rate and 5-year EBITDA growth rate outperform 79.7% and 81.56% of global competitors, respectively.
Concluding Insights on Royal Gold Inc's Dividend Profile
In conclusion, Royal Gold Inc's consistent dividend payments, robust growth rate, prudent payout ratio, and strong profitability and growth metrics paint a promising picture for investors seeking reliable dividend income. These factors collectively suggest that the company is well-positioned to continue its track record of dividend growth and sustainability. Investors aiming to diversify their portfolio with dividend-yielding stocks may find Royal Gold Inc an attractive option. Is Royal Gold Inc poised to maintain its dividend achiever status in the years to come? For those interested in exploring further, GuruFocus Premium offers tools like the High Dividend Yield Screener to identify high-dividend yield stocks.
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.
