Understanding Oracle Corp's Dividend Dynamics
Oracle Corp (ORCL, Financial) recently announced a dividend of $0.4 per share, payable on 2024-01-25, with the ex-dividend date set for 2024-01-10. 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 delve into Oracle Corp's dividend performance and evaluate its sustainability.
What Does Oracle Corp Do?
Oracle provides database technology and enterprise resource planning, or ERP, software to enterprises around the world. Founded in 1977, Oracle pioneered the first commercial SQL-based relational database management system. Today, Oracle has 430,000 customers in 175 countries, supported by its base of 136,000 employees.
A Glimpse at Oracle Corp's Dividend History
Oracle Corp has maintained a consistent dividend payment record since 2009, with dividends distributed on a quarterly basis. The company has not only provided shareholders with regular income but has also increased its dividend annually since 2009. This achievement has earned Oracle Corp the status of a dividend achiever, a prestigious recognition for companies that have consistently raised their dividends for at least 15 consecutive years.
Below is a chart showing annual Dividends Per Share for Oracle Corp, illustrating the historical trends in its dividend payments.
Breaking Down Oracle Corp's Dividend Yield and Growth
As of today, Oracle Corp's trailing dividend yield stands at 1.47%, with a 12-month forward dividend yield of 1.55%. This forward-looking metric indicates an anticipated increase in dividend payments over the next year. Over the past three years, the company's annual dividend growth rate was 12.30%, which further increased to 13.30% over a five-year period. Looking at a decade-long span, Oracle Corp's annual dividends per share growth rate impressively stands at 14.40%.
Considering Oracle Corp's dividend yield and five-year growth rate, the 5-year yield on cost for Oracle Corp stock is approximately 2.74% as of today.
The Sustainability Question: Payout Ratio and Profitability
The sustainability of Oracle Corp's dividends can be gauged by examining the company's payout ratio, which currently stands at 0.42. This ratio, which measures the proportion of earnings allocated to dividends, suggests that Oracle Corp retains a significant portion of its earnings, potentially funding future growth and buffering against downturns. Additionally, the company's profitability rank, at a high 9 out of 10, underscores its strong earnings capabilities relative to its peers. Oracle Corp's consistent track record of positive net income over the past decade further reinforces its robust profitability.
Growth Metrics: The Future Outlook
Oracle Corp's growth rank of 9 out of 10 speaks volumes about its promising growth trajectory compared to competitors. The company's revenue per share and 3-year revenue growth rate, averaging a 15.00% annual increase, outperforms approximately 64.76% of global competitors, indicating a solid revenue model. Oracle Corp's 3-year EPS growth rate, at an average of 2.90% per year, surpasses roughly 40.33% of global competitors. Lastly, the company's 5-year EBITDA growth rate of 24.10% outperforms approximately 73.14% of its global peers.
Next Steps
Oracle Corp's dividend payments, coupled with a strong dividend growth rate, reasonable payout ratio, high profitability, and solid growth metrics, present a compelling case for investors seeking steady income with growth potential. As Oracle Corp continues to navigate the evolving tech landscape, its commitment to shareholder returns remains evident. Investors considering Oracle Corp for their portfolios should weigh these factors in their decision-making process, and they can find additional high-dividend yield opportunities using the GuruFocus 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.
