Exploring the Dividend Performance and Sustainability of Analog Devices Inc
Analog Devices Inc (ADI, Financial) recently announced a dividend of $0.92 per share, payable on 2024-06-17, with the ex-dividend date set for 2024-06-04. 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 Analog Devices Inc's dividend performance and assess its sustainability.
What Does Analog Devices Inc Do?
Analog Devices is a preeminent manufacturer of analog, mixed signal, and digital signal processing chips. The company leads the market in converter chips, which translate analog signals to digital and vice versa. Serving tens of thousands of customers, over half of Analog Devices' chip sales target the industrial and automotive sectors. Additionally, their technology plays a crucial role in wireless infrastructure equipment.
A Glimpse at Analog Devices Inc's Dividend History
Analog Devices Inc has been a reliable payer of dividends since 2003, with distributions made quarterly. The company has also consistently increased its dividends annually since 2004, earning it the status of a dividend achiever—a title reserved for companies with at least 20 consecutive years of dividend increases.
Below is a chart illustrating the annual Dividends Per Share trends over the years.
Breaking Down Analog Devices Inc's Dividend Yield and Growth
Analog Devices Inc currently boasts a 12-month trailing dividend yield of 1.50% and a forward dividend yield of 1.58%, indicating anticipated dividend increases over the next year. However, with a yield close to a 10-year low and below the industry average, its attractiveness to income-focused investors may be limited.
Over the past three years, the annual dividend growth rate was 11.60%, extending to 12.10% over five years, and 9.60% over the past decade. The 5-year yield on cost for Analog Devices Inc stock is approximately 2.66% today.
The Sustainability Question: Payout Ratio and Profitability
The dividend payout ratio, sitting at 0.58 as of the latest data, suggests that Analog Devices retains a substantial portion of its earnings for growth and operational flexibility. The company's profitability rank of 9 out of 10, coupled with consistent positive net income over the past decade, underscores its strong earnings capacity.
Growth Metrics: The Future Outlook
Analog Devices Inc's impressive growth rank of 9 out of 10 reflects its robust growth trajectory. The company's revenue per share and 3-year revenue growth rate of 17.30% annually indicate a solid revenue model, outperforming 72.51% of global competitors. Additionally, the 3-year EPS growth rate of 26.10% and 5-year EBITDA growth rate of 11.50% further validate its growth potential.
In summary, Analog Devices Inc's consistent dividend payments, robust dividend growth rate, prudent payout ratio, and strong profitability and growth metrics paint a promising picture for current and prospective investors. With these factors in mind, Analog Devices Inc appears well-positioned to sustain its dividend payouts while pursuing future growth opportunities.
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.
