Exploring the Sustainability and Growth of Imperial Oil Ltd's Dividends
Imperial Oil Ltd (IMO, Financial) recently announced a dividend of $0.6 per share, payable on 2024-07-01, with the ex-dividend date set for 2024-06-03. 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 Imperial Oil Ltd's dividend performance and assess its sustainability.
What Does Imperial Oil Ltd Do?
Imperial Oil Ltd is one of Canada's largest integrated oil companies, active in all phases of the petroleum industry, including exploration, production, and sale of crude oil and natural gas. It stands as a major crude oil producer, the largest petroleum refiner, a leading marketer of petroleum products, and a significant producer of petrochemicals. The company also explores lower-emission business opportunities such as carbon capture and storage, hydrogen, and lower-emission fuels. Its operations are segmented into Upstream, Downstream, and Chemical, with the majority of revenue derived from the Downstream segment.
A Glimpse at Imperial Oil Ltd's Dividend History
Imperial Oil Ltd has maintained a consistent dividend payment record since 1984, distributing dividends on a quarterly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Imperial Oil Ltd's Dividend Yield and Growth
As of today, Imperial Oil Ltd currently has a 12-month trailing dividend yield of 2.28% and a 12-month forward dividend yield of 2.53%, indicating an expected increase in dividend payments over the next 12 months. Over the past three years, Imperial Oil Ltd's annual dividend growth rate was 30.10%, which decreased to 21.00% per year over a five-year horizon, and stands at 13.60% over the past decade. The 5-year yield on cost of Imperial Oil Ltd stock as of today is approximately 5.91%.
The Sustainability Question: Payout Ratio and Profitability
Assessing the sustainability of the dividend involves evaluating the company's dividend payout ratio. As of 2024-03-31, Imperial Oil Ltd's dividend payout ratio is 0.25, suggesting that the company retains a significant part of its earnings for future growth and unexpected downturns. Imperial Oil Ltd's profitability rank is 7 out of 10, indicating good profitability prospects with net profit reported in 9 of the past 10 years.
Growth Metrics: The Future Outlook
For sustainable dividends, robust growth metrics are crucial. Imperial Oil Ltd's growth rank of 7 suggests a good growth trajectory relative to competitors. The company's revenue per share and the 3-year revenue growth rate indicate a strong revenue model, with an average annual increase of approximately 44.20%, outperforming about 88.59% of global competitors.
Concluding Thoughts on Imperial Oil Ltd's Dividend Strategy
Imperial Oil Ltd's consistent dividend payments, robust growth in dividends per share, and strong financial metrics underscore its appeal to dividend-seeking investors. The company's strategic initiatives in low-emission technologies also ensure its adaptability in a changing energy landscape, promising sustainability in its dividend payments. For those looking to expand their portfolio with high-dividend yield stocks, consider using the High Dividend Yield Screener available to GuruFocus Premium users.
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.
