Unpacking the Dividend Dynamics of CBRE Clarion Global Real Estate Income Fund
An in-depth analysis of the dividend performance and sustainability of CBRE Clarion Global Real Estate Income Fund (NYSE:IGR)
CBRE Clarion Global Real Estate Income Fund (NYSE:IGR) recently announced a dividend of $0.06 per share, payable on 2023-09-29, with the ex-dividend date set for 2023-09-19. 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 deep dive into CBRE Clarion Global Real Estate Income Fund's dividend performance and assess its sustainability.
About CBRE Clarion Global Real Estate Income Fund
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CBRE Clarion Global Real Estate Income Fund is a United States-based diversified, closed-end management investment company. Its primary objective is to generate high current income while its secondary objective is capital appreciation. The fund invests a majority of its total assets in income-producing real estate securities located mainly in the developed markets of North America, Europe, Australia, and Asia. Its portfolio of investments spans various sectors such as diversified, retail, industrial, residential, hotels, healthcare, and others.
A Look at CBRE Clarion Global Real Estate Income Fund's Dividend History
CBRE Clarion Global Real Estate Income Fund has maintained a consistent dividend payment record since 2009, with dividends currently distributed on a monthly basis. The chart below provides a historical perspective on the company's annual Dividends Per Share.
Understanding CBRE Clarion Global Real Estate Income Fund's Dividend Yield and Growth
As of today, CBRE Clarion Global Real Estate Income Fund boasts a 12-month trailing dividend yield and a 12-month forward dividend yield of 14.81%, suggesting an expectation of steady dividend payments over the next 12 months. The company's dividend yield, near a 10-year high, outperforms 95.25% of global competitors in the Asset Management industry, making it an appealing proposition for income investors.
Over the past three years, CBRE Clarion Global Real Estate Income Fund's annual dividend growth rate was 2.20%. Over a five-year horizon, this rate decreased to 0.90% per year. Consequently, the 5-year yield on cost of CBRE Clarion Global Real Estate Income Fund stock as of today is approximately 15.36%.
Assessing Dividend Sustainability: 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 2023-06-30, CBRE Clarion Global Real Estate Income Fund's dividend payout ratio is 0.00.
CBRE Clarion Global Real Estate Income Fund's profitability rank of 2 out of 10, as of 2023-06-30, suggests that the dividend may not be sustainable in the long term. The company has reported net profit in 3 out of the past 10 years.
Future Prospects: Growth Metrics
To ensure the sustainability of dividends, a company must have robust growth metrics. CBRE Clarion Global Real Estate Income Fund's growth rank of 2 out of 10 suggests that the company has poor growth prospects. This could potentially impact the sustainability of its dividend payments in the future.
Concluding Thoughts
While CBRE Clarion Global Real Estate Income Fund's impressive dividend yield and consistent dividend payment history are attractive, investors must also consider the company's payout ratio and growth prospects. The low payout ratio indicates the company's ability to sustain its dividend payments. However, the company's low profitability and growth ranks suggest potential challenges in maintaining its dividend payments in the long run. Therefore, investors should weigh these factors carefully before making investment decisions.
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This article first appeared on GuruFocus.
