Understanding the Dividend Dynamics of Insperity Inc
Insperity Inc (NSP, Financial) recently announced a dividend of $0.57 per share, payable on 2023-12-18, with the ex-dividend date set for 2023-12-01. 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 Insperity Inc's dividend performance and assess its sustainability.
What Does Insperity Inc Do?
Insperity Inc is a company that primarily provides a wide range of human resources and business solutions that help businesses improve their performance. Small and midsize enterprises are the company's primary target customers. Most of the company's products are offered through the company's Workforce Optimization and Workforce Synchronization solutions, which comprise various human resource functions, such as payroll and employment administration, employee benefits and compensation, government compliance, performance management, training and development services, and human capital management. The company generates all of its revenue in the United States.
A Glimpse at Insperity Inc's Dividend History
Insperity Inc has maintained a consistent dividend payment record since 2005. Dividends are currently distributed on a quarterly basis. Insperity Inc has increased its dividend each year since 2005. The stock is thus listed as a dividend achiever, an honor that is given to companies that have increased their dividend each year for at least the past 18 years. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Insperity Inc's Dividend Yield and Growth
As of today, Insperity Inc currently has a 12-month trailing dividend yield of 1.90% and a 12-month forward dividend yield of 2.00%. This suggests an expectation of increased dividend payments over the next 12 months.
Over the past three years, Insperity Inc's annual dividend growth rate was 18.80%. Extended to a five-year horizon, this rate increased to 28.90% per year. And over the past decade, Insperity Inc's annual dividends per share growth rate stands at an impressive 22.80%.
Based on Insperity Inc's dividend yield and five-year growth rate, the 5-year yield on cost of Insperity Inc stock as of today is approximately 6.76%.
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, Insperity Inc's dividend payout ratio is 0.44.
Insperity Inc's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Insperity Inc's profitability 9 out of 10 as of 2023-09-30, 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. Insperity Inc'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 Insperity Inc's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Insperity Inc's revenue has increased by approximately 13.40% per year on average, a rate that outperforms approximately 74.1% 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, Insperity Inc's earnings increased by approximately 10.40% per year on average, a rate that outperforms approximately 49.18% of global competitors.
Lastly, the company's 5-year EBITDA growth rate of 13.40%, which outperforms approximately 63.16% of global competitors.
Next Steps
Considering Insperity Inc's consistent dividend payments, robust dividend growth rate, manageable payout ratio, and impressive profitability and growth metrics, the company presents a compelling case for investors seeking steady income with growth potential. The data suggests that Insperity Inc is not only maintaining but also potentially enhancing shareholder value through its dividends. As the company continues to navigate the dynamic business solutions industry, these financial indicators provide a promising outlook for its dividend sustainability. Investors looking for similar opportunities can utilize tools such as the High Dividend Yield Screener available to GuruFocus Premium users to discover high-dividend yield stocks.
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.
