Understanding Viatris Inc's Upcoming Dividend Payment
Viatris Inc (VTRS, Financial) recently announced a dividend of $0.12 per share, payable on 2023-12-15, with the ex-dividend date set for 2023-11-22. 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 Viatris Inc's dividend performance and assess its sustainability.
What Does Viatris Inc Do?
Viatris was formed in November 2020 through the combination of Upjohn, a wholly owned subsidiary of Pfizer that specialized in off-patent drugs, and Mylan, a global pharmaceutical manufacturer that focused on generic and specialty drugs. By joining forces, Viatris became one of the largest generic drug manufacturers in the world, servicing over 165 countries. Generics (commoditized and complex) and biosimilars make up roughly 40% of Viatris' total sales. Remaining 60% of sales is derived from its portfolio of legacy products which includes Lipitor, Norvasc, Lyrica, and Viagra. While it covers more than 10 major therapeutic areas, Viatris has identified dermatology, ophthalmology, and gastroenterology as its three key areas of focus for future innovations.
A Glimpse at Viatris Inc's Dividend History
Viatris Inc has maintained a consistent dividend payment record since 2021. Dividends are currently distributed on a quarterly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Viatris Inc's Dividend Yield and Growth
As of today, Viatris Inc currently has a 12-month trailing dividend yield of 5.12% and a 12-month forward dividend yield of 5.12%. This suggests an expectation of same dividend payments over the next 12 months. Based on Viatris Inc's dividend yield and five-year growth rate, the 5-year yield on cost of Viatris Inc stock as of today is approximately 5.12%.
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 2023-09-30, Viatris Inc's dividend payout ratio is 0.32.
Viatris Inc's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Viatris Inc's profitability 6 out of 10 as of 2023-09-30, suggesting fair profitability. The company has reported net profit in 8 years out of past 10 years.
Growth Metrics: The Future Outlook
To ensure the sustainability of dividends, a company must have robust growth metrics. Viatris Inc's growth rank of 6 out of 10 suggests that the company has a fair growth outlook. Revenue is the lifeblood of any company, and Viatris Inc's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Viatris Inc's revenue has increased by approximately -15.70% per year on average, a rate that underperforms approximately 87.8% 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, Viatris Inc's earnings increased by approximately -26.80% per year on average, a rate that underperforms approximately 85.42% of global competitors.
Next Steps
Considering Viatris Inc's dividend payments, dividend growth rate, payout ratio, profitability, and growth metrics, investors should weigh these factors carefully before making investment decisions. While the company has a track record of consistent dividend payments and a fair profitability rank, the negative revenue and earnings growth rates may raise concerns about long-term sustainability. Investors may want to monitor the company's strategic initiatives and any changes in the industry that could impact future performance. 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.
