Understanding the Dividend Dynamics of Svenska Cellulosa AB (SVCBF, Financial)
Svenska Cellulosa AB (SVCBF) recently announced a dividend of $2.75 per share, payable on 2024-04-02, with the ex-dividend date set for 2024-03-25. 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 Svenska Cellulosa AB's dividend performance and assess its sustainability.
What Does Svenska Cellulosa AB Do?
Svenska Cellulosa AB is Europe's largest private forest owner, with a diverse range of business segments. The Forest segment, which is a key revenue generator, supplies timber to its industries. The Wood segment comprises five sawmills in northern Sweden, providing wood processing and distribution to the building materials trade in Sweden and France. The Pulp segment produces and sells bleached softwood kraft pulp (NBSK) and chemi-thermomechanical pulp (CTMP) at the Ostrand pulp mill. The Containerboard segment focuses on packaging paper and kraft liner manufacturing at the Obbola and Munksund paper mills. Lastly, the Renewable Energy segment involves the production and sale of biofuels, both processed and unprocessed, as well as liquid biofuels.
A Glimpse at Svenska Cellulosa AB's Dividend History
Svenska Cellulosa AB has maintained a consistent dividend payment record since 2022, with dividends currently distributed on a yearly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Svenska Cellulosa AB's Dividend Yield and Growth
As of today, Svenska Cellulosa AB currently has a 12-month trailing dividend yield of 1.70% and a 12-month forward dividend yield of 1.86%. This suggests an expectation of increased dividend payments over the next 12 months. The 5-year yield on cost of Svenska Cellulosa AB stock as of today is approximately 1.70%.
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 2023-12-31, Svenska Cellulosa AB's dividend payout ratio is 0.48, suggesting a balance between paying dividends and retaining earnings for growth. Svenska Cellulosa AB's profitability rank is 7 out of 10, indicating good profitability prospects. The company has also reported positive net income for each of the past decade, further solidifying its financial stability.
Growth Metrics: The Future Outlook
Robust growth metrics are essential for the sustainability of dividends. Svenska Cellulosa AB's growth rank of 7 out of 10 suggests a good growth trajectory compared to competitors. However, the company's revenue per share and 3-year revenue growth rate indicate a revenue model that underperforms approximately 79.06% of global competitors. On the positive side, the company's 3-year EPS growth rate outperforms approximately 90.73% of global competitors. The 5-year EBITDA growth rate, although underperforming approximately 71.53% of global competitors, still provides a mixed outlook on the company's future financial performance.
Next Steps
Considering Svenska Cellulosa AB's consistent dividend payments, modest dividend growth rate, balanced payout ratio, and strong profitability, the company represents a potentially attractive option for value investors focused on dividend income. However, growth metrics present a nuanced picture, with some aspects like EPS growth outperforming while others like revenue and EBITDA growth lag behind. Investors should weigh these factors alongside industry trends, regulatory changes, and technological advancements that could impact Svenska Cellulosa AB's future performance. For those seeking to expand their portfolio with high-dividend yield stocks, GuruFocus Premium users can utilize the High Dividend Yield Screener for further research.
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.
