Assessing the Upcoming Dividend and Historical Performance of Var Energi ASA
Var Energi ASA (VARRY, Financial) recently announced a dividend of $0.21 per share, payable on 2024-03-12, with the ex-dividend date set for 2024-02-23. 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 Var Energi ASA's dividend performance and assess its sustainability.
What Does Var Energi ASA Do?
Var Energi ASA is an independent upstream oil and gas company on the Norwegian continental shelf. It operates within the geographical area of Norway and the business is entirely related to the exploration for and production of petroleum in Norway. Revenues are mainly related to the sale of oil, gas, and NGL.
A Glimpse at Var Energi ASA's Dividend History
Var Energi ASA has maintained a consistent dividend payment record since 2022, with dividends currently distributed on a quarterly basis. The company has increased its dividend each year since its inception, marking it as a potential candidate for dividend growth status in the future. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Var Energi ASA's Dividend Yield and Growth
As of today, Var Energi ASA has a 12-month trailing dividend yield of 14.23% and a 12-month forward dividend yield of 13.89%, suggesting an expectation of slightly decreased dividend payments over the next 12 months.
Based on Var Energi ASA's dividend yield and five-year growth rate, the 5-year yield on cost of Var Energi ASA stock as of today is approximately 14.23%.
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. As of 2023-09-30, Var Energi ASA's dividend payout ratio is 1.05, which may suggest that the company's dividend may not be sustainable.
Var Energi ASA's profitability rank, at 5 out of 10 as of 2023-09-30, suggests fair profitability, with the company reporting net profit in 3 years out of the past 10 years.
Growth Metrics: The Future Outlook
For dividends to be sustainable, a company must demonstrate robust growth metrics. Var Energi ASA's growth rank of 5 out of 10 indicates a fair growth outlook.
Var Energi ASA's revenue per share, combined with its 3-year revenue growth rate, indicates a strong revenue model, with revenue increasing by approximately 56.00% per year on average, outperforming about 94.26% of global competitors.
The company's 3-year EPS growth rate shows its ability to grow earnings, a key component for sustaining dividends, with an average annual increase of approximately 107.30%, outperforming about 93.36% of global competitors.
Next Steps
In conclusion, Var Energi ASA's consistent dividend payments, potential for growth, and current payout ratio indicate a mixed outlook for dividend sustainability. The company's strong revenue and earnings growth rates provide some assurance for future dividend stability. However, the relatively high payout ratio could be a concern if not managed alongside continued profitability and growth. Investors should monitor Var Energi ASA's financial health and market position while considering the broader industry trends and economic factors that could influence its dividend policy. GuruFocus Premium users can further explore high-dividend yield opportunities 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.
