Texas Roadhouse Inc's Dividend Analysis
Assessing the Dividend Performance and Sustainability of Texas Roadhouse Inc
Texas Roadhouse Inc (NASDAQ:TXRH) recently announced a dividend of $0.61 per share, payable on 2024-03-26, with the ex-dividend date set for 2024-03-12. 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 Texas Roadhouse Inc's dividend performance and assess its sustainability.
What Does Texas Roadhouse Inc Do?
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Texas Roadhouse Inc is a restaurant company operating predominantly in the casual dining segment. The company's operating segments include Texas Roadhouse; Bubba's 33, and others. It generates maximum revenue from the Texas Roadhouse segment.
A Glimpse at Texas Roadhouse Inc's Dividend History
Texas Roadhouse Inc has maintained a consistent dividend payment record since 2011. Dividends are currently distributed on a quarterly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Texas Roadhouse Inc's Dividend Yield and Growth
As of today, Texas Roadhouse Inc currently has a 12-month trailing dividend yield of 1.48% and a 12-month forward dividend yield of 1.52%. This suggests an expectation of increased dividend payments over the next 12 months.
Over the past three years, Texas Roadhouse Inc's annual dividend growth rate was 82.80%. Extended to a five-year horizon, this rate decreased to 20.20% per year. And over the past decade, Texas Roadhouse Inc's annual dividends per share growth rate stands at an impressive 12.20%.
Based on Texas Roadhouse Inc's dividend yield and five-year growth rate, the 5-year yield on cost of Texas Roadhouse Inc stock as of today is approximately 3.71%.
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, Texas Roadhouse Inc's dividend payout ratio is 0.48.
Texas Roadhouse Inc's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Texas Roadhouse 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. Texas Roadhouse 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 Texas Roadhouse Inc's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Texas Roadhouse Inc's revenue has increased by approximately 26.20% per year on average, a rate that outperforms approximately 92% 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, Texas Roadhouse Inc's earnings increased by approximately 112.40% per year on average, a rate that outperforms approximately 97.8% of global competitors.
Lastly, the company's 5-year EBITDA growth rate of 22.40%, which outperforms approximately 85.05% of global competitors.
Next Steps
Considering Texas Roadhouse Inc's consistent dividend payments, robust dividend growth rate, prudent payout ratio, solid profitability, and impressive growth metrics, the company appears to be a strong contender for value investors seeking reliable income streams. The data suggests that Texas Roadhouse Inc is not only managing to reward shareholders with regular dividends but is also positioning itself for sustainable future growth. Investors looking for dividend-paying stocks with growth potential may find Texas Roadhouse Inc an interesting prospect to explore further.
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.
