A comprehensive look at the pharmaceutical giant's dividend history, growth, and future prospects
Gilead Sciences Inc(GILD, Financial) recently announced a dividend of $0.75 per share, payable on 2023-09-28, with the ex-dividend date set for 2023-09-14. As investors eagerly anticipate this upcoming payment, it is also crucial to examine the company's dividend history, yield, and growth rates. Using the data from GuruFocus, let's delve into Gilead Sciences Inc's dividend performance and assess its sustainability.
Company Overview: Gilead Sciences Inc
Gilead Sciences Inc is a leading biopharmaceutical company that develops and markets therapies to combat life-threatening infectious diseases. Its portfolio primarily focuses on HIV and hepatitis B and C. The company has also expanded its scope to include pulmonary and cardiovascular diseases and cancer through acquisitions. Gilead Sciences Inc's acquisition of Pharmasset brought rights to the hepatitis C drug Sovaldi, part of the combination drug Harvoni, while the acquisitions of Kite, Forty Seven, and Immunomedics have enhanced Gilead's exposure to cell therapy and non-cell therapy in oncology.
Reflecting on Gilead Sciences Inc's Dividend History
Since 2015, Gilead Sciences Inc has consistently maintained a solid dividend payment record, distributed on a quarterly basis. The chart below provides a historical perspective on the company's annual Dividends Per Share.
Understanding Gilead Sciences Inc's Dividend Yield and Growth
As of today, Gilead Sciences Inc boasts a 12-month trailing dividend yield of 3.83% and a 12-month forward dividend yield of 3.90%, indicating an expected increase in dividend payments over the next 12 months. Over the past three years, the company's annual dividend growth rate was 5.00%, which increased to 7.20% per year when extended to a five-year horizon. Consequently, the 5-year yield on cost of Gilead Sciences Inc stock as of today is approximately 5.42%.
Assessing Dividend Sustainability: Payout Ratio and Profitability
The sustainability of a company's dividend can be evaluated by examining its payout ratio. The dividend payout ratio reveals the percentage of earnings a company distributes as dividends. A lower ratio implies that the company retains a significant portion of its earnings, providing a safety net for future growth and unexpected downturns. As of 2023-06-30, Gilead Sciences Inc's dividend payout ratio is 0.68.
Gilead Sciences Inc's profitability rank is 9 out of 10 as of 2023-06-30, suggesting strong profitability prospects. The company has reported positive net income each year for the past decade, further bolstering its high profitability.
Growth Metrics: A Peek into the Future
Robust growth metrics are essential for a company to sustain its dividends. Gilead Sciences Inc's growth rank of 9 out of 10 suggests a strong growth trajectory relative to its competitors. The company's revenue per share and 3-year revenue growth rate indicate a strong revenue model, with an average annual increase of approximately 7.10%. This rate outperforms approximately 54.22% of global competitors. Furthermore, Gilead Sciences Inc's 3-year EPS growth rate and 5-year EBITDA growth rate reflect its ability to grow earnings, a critical factor for sustaining dividends in the long run.
Final Thoughts
In conclusion, Gilead Sciences Inc's consistent dividend payments, impressive growth rate, reasonable payout ratio, high profitability, and robust growth metrics collectively suggest a promising future for its dividends. However, investors should continue to monitor these factors to ensure the company's dividend performance remains sustainable. For those seeking high-dividend yield stocks, the High Dividend Yield Screener available for GuruFocus Premium users can be a valuable tool.
