An In-depth Look at the Dividend Performance and Sustainability of PT United Tractors Tbk
PT United Tractors Tbk (PUTKY, Financial) recently announced a dividend of $0.9 per share, payable on 2023-11-08, with the ex-dividend date set for 2023-10-12. 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 PT United Tractors Tbk's dividend performance and assess its sustainability.
What Does PT United Tractors Tbk Do?
PT United Tractors Tbk is one of the largest distributors of heavy equipment in Indonesia. It manufactures construction machinery and provides mining services to help customers tap natural resources. The machinery is distributed under various brands and works in the mining, construction, forestry, material handling, and transportation sectors. The company operates contact centers to deliver spare parts, mechanics support, and repair machines for customers. United Tractors operates five business segments: construction machinery, mining contracting (a majority of total revenues), coal mining, gold mining, and construction industry. Mining services pertain to mine design, exploration, extracting, and hauling commodities. The majority of total sales are generated in Indonesia.
A Glimpse at PT United Tractors Tbk's Dividend History
PT United Tractors Tbk has maintained a consistent dividend payment record since 2009. Dividends are currently distributed on a bi-annually basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down PT United Tractors Tbk's Dividend Yield and Growth
As of today, PT United Tractors Tbk currently has a 12-month trailing dividend yield of 27.58% and a 12-month forward dividend yield of 27.15%. This suggests an expectation of decrease dividend payments over the next 12 months.
Over the past three years, PT United Tractors Tbk's annual dividend growth rate was 11.70%. Extended to a five-year horizon, this rate stayed the same. And over the past decade, PT United Tractors Tbk's annual dividends per share growth rate stands at 8.80%.
Based on PT United Tractors Tbk's dividend yield and five-year growth rate, the 5-year yield on cost of PT United Tractors Tbk stock as of today is approximately 47.96%.
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, PT United Tractors Tbk's dividend payout ratio is 1.15. This may suggest that the company's dividend may not be sustainable.
PT United Tractors Tbk's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks PT United Tractors Tbk's profitability 9 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. PT United Tractors Tbk's growth rank of 9 out of 10 suggests that the company's growth trajectory is good relative to its competitors.
Revenue is the lifeblood of any company, and PT United Tractors Tbk's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. PT United Tractors Tbk's revenue has increased by approximately 13.90% per year on average, a rate that outperforms approximately 55.11% 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, PT United Tractors Tbk's earnings increased by approximately 23.30% per year on average, a rate that outperforms approximately 63.28% of global competitors.
Lastly, the company's 5-year EBITDA growth rate of 13.40%, outperforms approximately 49.96% of global competitors.
Next Steps
In conclusion, PT United Tractors Tbk's strong dividend history, substantial yield, and growth rates suggest a promising investment for dividend-focused investors. However, the high payout ratio raises concerns about the sustainability of future dividends. The company's strong profitability and growth metrics, on the other hand, provide an optimistic outlook. Investors should continue to monitor these factors closely to make informed decisions.
GuruFocus Premium users can screen for high-dividend yield stocks using 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.
