An In-depth Look at VF Corp's Dividend Sustainability and Performance
VF Corp (VFC, Financial) recently announced a dividend of $0.09 per share, payable on 2024-06-20, with the ex-dividend date set for 2024-06-10. 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 VF Corp's dividend performance and assess its sustainability.
What Does VF Corp Do?
VF designs, produces, and distributes branded apparel, footwear, and accessories. Its apparel categories are active, outdoor, and work. Its portfolio of about a dozen brands includes Vans, The North Face, Timberland, Supreme, and Dickies. VF markets its products in the Americas, Europe, and Asia-Pacific through wholesale sales to retailers, e-commerce, and branded stores owned by the company and partners. Tracing its roots to 1899, the company has evolved through many brand acquisitions and dispositions.
A Glimpse at VF Corp's Dividend History
VF Corp has maintained a consistent dividend payment record since 1973, distributing dividends on a quarterly basis. This long-standing tradition has earned VF Corp the status of a dividend king, a prestigious title awarded to companies that have increased their dividends annually for at least 51 years.
Below is a chart showing annual Dividends Per Share to track historical trends.
Breaking Down VF Corp's Dividend Yield and Growth
As of today, VF Corp currently has a 12-month trailing dividend yield of 5.74% and a 12-month forward dividend yield of 2.65%, indicating an expected decrease in dividend payments over the next 12 months. Over the past three years, VF Corp's annual dividend growth rate was -26.20%, extending to a five-year rate of -12.50% per year.
Based on VF Corp's dividend yield and five-year growth rate, the 5-year yield on cost of VF Corp stock as of today is approximately 2.95%.
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 2024-03-31, VF Corp's dividend payout ratio is 1.63, which may suggest that the company's dividend may not be sustainable. Additionally, VF Corp's profitability rank of 7 out of 10, along with its history of net profit in 8 out of the past 10 years, suggests good profitability prospects.
Growth Metrics: The Future Outlook
VF Corp's growth rank of 7 out of 10 suggests a good growth trajectory relative to competitors. However, its revenue per share and 3-year revenue growth rate of approximately 4.50% per year underperforms 54.7% of global competitors. Moreover, VF Corp's 3-year EPS growth rate of -43.60% per year and 5-year EBITDA growth rate of -29.80% also underperform the majority of global competitors.
Considering VF Corp's dividend payments, growth rate, payout ratio, profitability, and growth metrics, investors should carefully evaluate the potential risks and rewards. For those looking to explore further, GuruFocus Premium users can use the High Dividend Yield Screener to find high-yield investment opportunities.
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.
