Whitestone REIT (WSR): A Deep Dive into its Dividend Performance and Sustainability
Exploring the Dividend History, Yield, Growth, and Future Prospects of Whitestone REIT
Whitestone REIT (NYSE:WSR) recently announced a dividend of $0.04 per share, payable on 2023-11-14, with the ex-dividend date set for 2023-11-01. 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 deep dive into Whitestone REITs dividend performance and assess its sustainability.
What Does Whitestone REIT Do?
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Whitestone REIT is a real estate investment trust (REIT) engaged in owning and operating commercial properties in culturally diverse markets in metropolitan areas. Its property portfolio includes retail and office/flex properties. The company's properties are located in business-friendly locations in and around Austin, Chicago, Dallas-Fort Worth, Houston, Phoenix, and San Antonio. The organization derives revenue in the form of rental revenues.
A Glimpse at Whitestone REIT's Dividend History
Whitestone REIT has maintained a consistent dividend payment record since 2010. Dividends are currently distributed on a monthly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Whitestone REIT's Dividend Yield and Growth
As of today, Whitestone REIT currently has a 12-month trailing dividend yield of 4.98% and a 12-month forward dividend yield of 4.98%. This suggests an expectation of same dividend payments over the next 12 months.
Over the past three years, Whitestone REIT's annual dividend growth rate was -25.50%. Extended to a five-year horizon, this rate increased to -20.70% per year. And over the past decade, Whitestone REIT's annual dividends per share growth rate stands at -9.20%.
Based on Whitestone REIT's dividend yield and five-year growth rate, the 5-year yield on cost of Whitestone REIT stock as of today is approximately 1.55%.
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 2023-06-30, Whitestone REIT's dividend payout ratio is 0.62.
Whitestone REIT's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Whitestone REIT's profitability 7 out of 10 as of 2023-06-30, 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. Whitestone REIT's growth rank of 7 out of 10 suggests that the company's growth trajectory is good relative to its competitors.
Revenue is the lifeblood of any company, and Whitestone REIT's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Whitestone REIT's revenue has increased by approximately -0.70% per year on average, a rate that underperforms than approximately 60.7% 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, Whitestone REIT's earnings increased by approximately 8.20% per year on average, a rate that underperforms than approximately 40.79% of global competitors.
Lastly, the company's 5-year EBITDA growth rate of 5.60%, which underperforms than approximately 44.79% of global competitors.
Next Steps
Despite some challenges, Whitestone REIT has demonstrated a consistent dividend payment history, a decent dividend yield, and a good profitability rank. However, the company's negative dividend growth rate and underperformance in revenue and earnings growth relative to its global competitors might be areas of concern for investors. Thus, investors should closely monitor these metrics while considering Whitestone REIT for their portfolio. GuruFocus Premium users can screen for high-dividend yield stocks using the High Dividend Yield Screener.
This article first appeared on GuruFocus.
