Exploring the Dividend Profile of Kaiser Aluminum Corp
Kaiser Aluminum Corp (KALU, Financial) recently announced a dividend of $0.77 per share, payable on 2024-02-15, with the ex-dividend date set for 2024-01-24. 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 Kaiser Aluminum Corp's dividend performance and assess its sustainability.
What Does Kaiser Aluminum Corp Do?
Kaiser Aluminum Corp produces and sells semi-fabricated specialty aluminum products primarily to industrial customers. The company purchases primary and scrap aluminum, primarily from its five largest suppliers, and processes it into specialized value-added products. It hedges its aluminum costs in an attempt to match commodity price changes between the time it purchases the raw materials and sells the finished products. Kaiser produces high-strength aluminum products for the aerospace industry, specialized aluminum extrusions for the automotive industry, and also sells products to customers in the general engineering industry. Nearly all of Kaiser's revenue is generated in the US, with the remainder coming from Canada. The company's operations are also located in the U.S. and Canada.
A Glimpse at Kaiser Aluminum Corp's Dividend History
Kaiser Aluminum Corp has maintained a consistent dividend payment record since 2007. Dividends are currently distributed on a quarterly basis.
Kaiser Aluminum Corp has increased its dividend each year since 2007. 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 17 years. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Kaiser Aluminum Corp's Dividend Yield and Growth
As of today, Kaiser Aluminum Corp currently has a 12-month trailing dividend yield of 4.76% and a 12-month forward dividend yield of 4.76%. This suggests an expectation of the same dividend payments over the next 12 months.
Over the past three years, Kaiser Aluminum Corp's annual dividend growth rate was 8.70%. Extended to a five-year horizon, this rate increased to 9.20% per year. And over the past decade, Kaiser Aluminum Corp's annual dividends per share growth rate stands at an impressive 11.60%.
Based on Kaiser Aluminum Corp's dividend yield and five-year growth rate, the 5-year yield on cost of Kaiser Aluminum Corp stock as of today is approximately 7.39%.
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, Kaiser Aluminum Corp's dividend payout ratio is 3.85, which may suggest that the company's dividend may not be sustainable.
Kaiser Aluminum Corp's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Kaiser Aluminum Corp's profitability 7 out of 10 as of 2023-09-30, suggesting good profitability prospects. The company has reported net profit in 7 years out of the past 10 years.
Growth Metrics: The Future Outlook
To ensure the sustainability of dividends, a company must have robust growth metrics. Kaiser Aluminum Corp's growth rank of 7 out of 10 suggests that the company's growth trajectory is good relative to its competitors.
Revenue is the lifeblood of any company, and Kaiser Aluminum Corp's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Kaiser Aluminum Corp's revenue has increased by approximately 32.10% per year on average, a rate that outperforms approximately 82.74% of global competitors.
Concluding Insights on Kaiser Aluminum Corp's Dividend Fortitude
In conclusion, Kaiser Aluminum Corp's consistent dividend growth, coupled with a solid yield and a prudent payout ratio, paints a promising picture for dividend-seeking investors. The company's strong profitability and growth metrics back up the sustainability of its dividends, making it an attractive option for value investors focused on income. As the aluminum industry evolves and Kaiser Aluminum Corp continues to navigate market dynamics, the company's dividend policy will likely remain a key factor in investment 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.
