Yahoo Finance Volkswagen AG's Dividend Analysis
Exploring the Dividend Performance and Sustainability of Volkswagen AG (VWAGY)
Volkswagen AG (VWAGY) recently announced a dividend of $0.96 per share, payable on 2024-06-20, with the ex-dividend date set for 2024-05-31. 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 Volkswagen AG's dividend performance and assess its sustainability.
What Does Volkswagen AG Do?
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Volkswagen is one of the world's largest automotive manufacturers. Its passenger car brands include Volkswagen, Audi, Bentley, Lamborghini, Porsche, SEAT, and Skoda. Commercial vehicle brands include MAN, Navistar, Scania, and Volkswagen. The company's financial services group provides dealer financing to support floor plans, consumer financing for vehicle purchases, vehicle leasing, banking, and other financial services. In 2022, Europe was Volkswagen's largest light vehicle market at 41% of total volume, followed by China at 37%, and rest of world at 22%.
A Glimpse at Volkswagen AG's Dividend History
Volkswagen AG has maintained a consistent dividend payment record since 1989. Dividends are currently distributed on a yearly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Volkswagen AG's Dividend Yield and Growth
As of today, Volkswagen AG currently has a 12-month trailing dividend yield of 6.35% and a 12-month forward dividend yield of 6.46%. This suggests an expectation of increased dividend payments over the next 12 months.
Over the past three years, Volkswagen AG's annual dividend growth rate was 21.70%. Extended to a five-year horizon, this rate decreased to 16.30% per year. And over the past decade, Volkswagen AG's annual dividends per share growth rate stands at an impressive 14.20%.
Based on Volkswagen AG's dividend yield and five-year growth rate, the 5-year yield on cost of Volkswagen AG stock as of today is approximately 13.51%.
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. A lower ratio suggests that the company retains a significant part of its earnings, thereby ensuring the availability of funds for future growth and unexpected downturns. As of 2024-03-31, Volkswagen AG's dividend payout ratio is 0.29.
Volkswagen AG's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Volkswagen AG's profitability 8 out of 10 as of 2024-03-31, suggesting good profitability prospects. The company has reported net profit in 9 years out of the past 10 years.
Growth Metrics: The Future Outlook
To ensure the sustainability of dividends, a company must have robust growth metrics. Volkswagen AG's growth rank of 8 out of 10 suggests that the company's growth trajectory is good relative to its competitors.
Revenue is the lifeblood of any company, and Volkswagen AG's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Volkswagen AG's revenue has increased by approximately 13.10% per year on average, a rate that outperforms approximately 57.78% of global competitors.
The company's 3-year EPS growth rate showcases its capability to grow its earnings, a critical component for sustaining dividends in the long run. During the past three years, Volkswagen AG's earnings increased by approximately 38.90% per year on average, a rate that outperforms approximately 72.41% of global competitors.
Lastly, the company's 5-year EBITDA growth rate of 7.80%, which outperforms approximately 49.77% of global competitors.
Next Steps
With a strong dividend performance, robust payout ratio, and solid growth metrics, Volkswagen AG presents a compelling case for value investors seeking sustainable income streams. As the automotive giant continues to navigate the complexities of the global market, its dividend policy remains a key aspect of its appeal to shareholders. Will Volkswagen AG continue to deliver value to its investors through thick and thin? Only time will tell, but the signs are promising. 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.
This article first appeared on GuruFocus.
