Yahoo Finance Knorr-Bremse AG's Dividend Analysis
Exploring the Sustainability and Growth of Dividends at Knorr-Bremse AG
Introduction to Knorr-Bremse AG's Dividend Announcement
Knorr-Bremse AG (KNRRY) recently announced a dividend of $0.45 per share, payable on 2024-05-20, with the ex-dividend date set for 2024-05-02. 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 Knorr-Bremse AG's dividend performance and assess its sustainability.
What Does Knorr-Bremse AG Do?
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Knorr-Bremse AG is engaged in the development, production, marketing, and servicing of automotive parts. It operates its business activities in two divisions: Rail Vehicle Systems and Commercial Vehicle Systems. Its product portfolio comprises braking, entrance, and HVAC systems; power electric and control technology; digital solutions; couplers; signal systems; pneumatic braking systems; energy supply and distribution systems; wiper and wash systems; and others. Its geographical segments are Europe/Africa, North America, South America, and Asia-Pacific.
A Glimpse at Knorr-Bremse AG's Dividend History
Knorr-Bremse AG has maintained a consistent dividend payment record since 2019. Dividends are currently distributed on a yearly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Knorr-Bremse AG's Dividend Yield and Growth
As of today, Knorr-Bremse AG currently has a 12-month trailing dividend yield of 2.15% and a 12-month forward dividend yield of 2.43%. This suggests an expectation of increased dividend payments over the next 12 months. Over the past three years, Knorr-Bremse AG's annual dividend growth rate was -7.00%. Based on Knorr-Bremse AG's dividend yield and five-year growth rate, the 5-year yield on cost of Knorr-Bremse AG stock as of today is approximately 2.15%.
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, Knorr-Bremse AG's dividend payout ratio is 0.43. Knorr-Bremse AG's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Knorr-Bremse AG's profitability 8 out of 10 as of 2023-12-31, suggesting good profitability prospects. The company has reported net profit in 9 years out of the past 10 years.
Growth Metrics: The Future Outlook
To ensure the sustainability of dividends, a company must have robust growth metrics. Knorr-Bremse AG's growth rank of 8 out of 10 suggests that the company's growth trajectory is good relative to its competitors. Revenue is the lifeblood of any company, and Knorr-Bremse AG's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Knorr-Bremse AG's revenue has increased by approximately 8.80% per year on average, a rate that underperforms approximately 51.89% 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, Knorr-Bremse AG's earnings increased by approximately 4.90% per year on average, a rate that underperforms approximately 63.17% of global competitors. Lastly, the company's 5-year EBITDA growth rate of -1.20%, which underperforms approximately 65.2% of global competitors.
Conclusion: Evaluating the Viability of Dividend Investments in Knorr-Bremse AG
Considering Knorr-Bremse AG's current dividend yield, historical payment consistency, payout ratio, and growth metrics, the company presents a mixed picture for dividend investors. While its dividend yield and profitability rank are promising, the negative growth rates in dividends and some financial metrics suggest caution. Investors should weigh these factors carefully against their investment strategy and risk tolerance. For those interested in further exploring high-dividend yield opportunities, GuruFocus Premium users can utilize 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.
