Yahoo Finance The Estee Lauder Companies Inc's Dividend Analysis
Exploring the Sustainability and Growth of Estee Lauder's Dividend Payments
The Estee Lauder Companies Inc (NYSE:EL) recently announced a dividend of $0.66 per share, payable on 2024-06-17, with the ex-dividend date set for 2024-05-31. 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 The Estee Lauder Companies Inc's dividend performance and assess its sustainability.
What Does The Estee Lauder Companies Inc Do?
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Estee Lauder is a leader in the global prestige beauty market, participating across skin care (52% of 2023 sales), makeup (28%), fragrance (16%), and hair care (4%) categories, with top-selling brands such as Estee Lauder, Clinique, M.A.C, La Mer, Jo Malone London, Aveda, Bobbi Brown, and Origins. The firm operates in more than 150 countries, generating 28% of revenue from the Americas, 39% from Europe, the Middle East and Africa (including travel retail), and 33% from Asia-Pacific. Estee Lauder sells its products through department stores, travel retail, specialty multibrand beauty stores, brand-dedicated freestanding stores, e-commerce, salons/spas, and perfumeries.
A Glimpse at The Estee Lauder Companies Inc's Dividend History
The Estee Lauder Companies Inc has maintained a consistent dividend payment record since 1996, distributing dividends on a quarterly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down The Estee Lauder Companies Inc's Dividend Yield and Growth
The Estee Lauder Companies Inc currently boasts a 12-month trailing dividend yield and a 12-month forward dividend yield of 2.15%, indicating an expectation of consistent dividend payments over the next year. Over the past three years, the annual dividend growth rate was 22.90%, which decreased to 12.70% per year over a five-year horizon, and an impressive 11.30% over the past decade. The 5-year yield on cost for The Estee Lauder Companies Inc stock as of today is approximately 3.91%.
The Sustainability Question: Payout Ratio and Profitability
Assessing the sustainability of the dividend, the dividend payout ratio of 1.30 as of 2024-03-31 suggests potential challenges in maintaining current dividend levels. However, The Estee Lauder Companies Inc's profitability rank of 9 out of 10 indicates strong earnings capabilities, supported by a decade of positive net income.
Growth Metrics: The Future Outlook
The Estee Lauder Companies Inc's growth rank of 9 out of 10 reflects a robust growth trajectory. The company's revenue per share and a 3-year revenue growth rate of 4.20% per year highlight a strong revenue model, despite underperforming 60.74% of global competitors. The 3-year EPS growth rate of -5.70% per year and a 5-year EBITDA growth rate of 0.10% suggest areas for improvement in earnings growth relative to industry peers.
Conclusion: Evaluating Dividend Stability and Growth Prospects
While The Estee Lauder Companies Inc demonstrates a commendable dividend history and profitability, the sustainability of its dividend payments hinges on improving its payout ratio and earnings growth. Investors should monitor these metrics closely, alongside industry trends and company strategic initiatives, to make informed decisions. For those looking to explore further, GuruFocus Premium offers tools like the High Dividend Yield Screener to find high-yield opportunities.
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.
