Stella-Jones Inc's Dividend Analysis
Assessing the Upcoming Dividend and Historical Performance of Stella-Jones Inc (STLJF)
Stella-Jones Inc (STLJF) recently announced a dividend of $0.23 per share, payable on 2023-12-21, with the ex-dividend date set for 2023-12-01. 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 Stella-Jones Inc's dividend performance and assess its sustainability.
What Does Stella-Jones Inc Do?
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Stella-Jones Inc produces and sells lumber and wood products. The company operates in two segments: Pressure-treated wood, which includes utility poles, railway ties, residential lumber, and industrial products; and Logs & Lumber segment comprises of the sales of logs harvested in the course of the company's procurement process that is determined to be unsuitable for use as utility poles, it also includes the sale of excess lumber to local home-building markets. The vast majority of its revenue comes from the Pressure-treated wood segment. Its geographical segments are the United States and Canada, of which the majority of its revenue is derived from the United States.
A Glimpse at Stella-Jones Inc's Dividend History
Stella-Jones Inc has maintained a consistent dividend payment record since 2004, with dividends currently distributed on a quarterly basis. Stella-Jones Inc has increased its dividend each year since 2012, earning it the status of a dividend achiever, a distinction given to companies with at least 11 consecutive years of dividend increases. Below is a chart showing annual Dividends Per Share to track historical trends.
Breaking Down Stella-Jones Inc's Dividend Yield and Growth
As of today, Stella-Jones Inc currently has a 12-month trailing dividend yield of 1.14% and a 12-month forward dividend yield of 1.16%, indicating anticipated dividend increases over the next year. Over the past three years, the company's annual dividend growth rate was 12.60%, which further increased to 13.00% per year over a five-year span. Over the past decade, Stella-Jones Inc's annual dividends per share growth rate has been an impressive 16.60%.
Considering Stella-Jones Inc's dividend yield and five-year growth rate, the 5-year yield on cost for Stella-Jones Inc stock is approximately 2.10%.
The Sustainability Question: Payout Ratio and Profitability
To assess the sustainability of the dividend, one must examine the company's payout ratio. Stella-Jones Inc's dividend payout ratio is 0.17 as of 2023-09-30, implying that a smaller portion of earnings is distributed as dividends, allowing for reinvestment in growth and a buffer for downturns. The company's profitability rank is 9 out of 10, indicating strong earnings potential compared to peers. Consistently positive net income over the past decade underscores this high profitability.
Growth Metrics: The Future Outlook
Stella-Jones Inc's growth rank of 9 out of 10 reflects a promising growth trajectory. The company's revenue per share and 3-year revenue growth rate indicate a robust revenue model, with an average annual increase of 16.20%, outperforming approximately 77.29% of global competitors. Stella-Jones Inc's 3-year EPS growth rate of 18.40% per year and 5-year EBITDA growth rate of 13.40% further demonstrate its earnings growth capacity, outperforming 54.07% and 60.58% of global competitors, respectively.
Next Steps
In conclusion, Stella-Jones Inc's consistent dividend payments, robust dividend growth rate, modest payout ratio, strong profitability, and solid growth metrics position it as a potentially attractive investment for dividend-seeking investors. The company's track record of financial health and commitment to returning value to shareholders through dividends may offer reassurance amidst market volatility. As Stella-Jones Inc approaches its next dividend date, investors should consider the company's historical performance and promising growth indicators when evaluating its potential as a long-term income-generating asset. For further investment research, GuruFocus Premium users can utilize the High Dividend Yield Screener to discover other 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.
