Kansai Electric Power Co Inc's Dividend Analysis
Assessing the Sustainability of KAEPF's Dividend Payments
Kansai Electric Power Co Inc (KAEPF) recently announced a dividend of $0.25 per share, payable on a date yet to be announced, with the ex-dividend date set for 2024-03-28. 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 Kansai Electric Power Co Inc's dividend performance and assess its sustainability.
What Does Kansai Electric Power Co Inc Do?
This Powerful Chart Made Peter Lynch 29% A Year For 13 Years
How to calculate the intrinsic value of a stock?
Kansai Electric Power Co Inc is an electric utility company that supplies power to the Kansai region of the Japanese archipelago. The company controls a portfolio of hydroelectric, thermal, nuclear, and solar power plants located in Kansai and in other countries throughout Southeast Asia. The vast majority of the energy produced by Kansai Electric comes from its thermal facilities. The company generates most of its revenue from the sale of electricity, heat, and gas to households and corporate customers. Kansai Electric's utility services, information technology, and real estate businesses also represent substantial revenue streams. The company provides energy to a significant percentage of the Japanese population.
A Glimpse at Kansai Electric Power Co Inc's Dividend History
Kansai Electric Power Co Inc has maintained a consistent dividend payment record since 2020. Dividends are currently distributed on a bi-annual basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Kansai Electric Power Co Inc's Dividend Yield and Growth
As of today, Kansai Electric Power Co Inc currently has a 12-month trailing dividend yield of 2.48% and a 12-month forward dividend yield of 2.70%. This suggests an expectation of increased dividend payments over the next 12 months. Extended to a five-year horizon, this rate increased to 5.20% per year. Based on Kansai Electric Power Co Inc's dividend yield and five-year growth rate, the 5-year yield on cost of Kansai Electric Power Co Inc stock as of today is approximately 3.20%.
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 2023-12-31, Kansai Electric Power Co Inc's dividend payout ratio is 0.08.
Kansai Electric Power Co Inc's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Kansai Electric Power Co Inc's profitability 6 out of 10 as of 2023-12-31, suggesting fair profitability. The company has reported net profit in 8 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. Kansai Electric Power Co Inc's growth rank of 6 out of 10 suggests that the company has a fair growth outlook. Revenue is the lifeblood of any company, and Kansai Electric Power Co Inc's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Kansai Electric Power Co Inc's revenue has increased by approximately 7.50% per year on average, a rate that underperforms approximately 59.78% 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, Kansai Electric Power Co Inc's earnings have decreased by approximately -51.10% per year on average, a rate that underperforms approximately 91.67% of global competitors.
Lastly, the company's 5-year EBITDA growth rate of -29.20%, which underperforms approximately 93.56% of global competitors, raises concerns about its ability to sustain dividend growth in the long term.
Looking Ahead: Kansai Electric Power Co Inc's Dividend Prospects
In conclusion, Kansai Electric Power Co Inc's dividend history reflects a pattern of consistent payments, with a moderate yield and a low payout ratio that suggests room for future growth. However, the company's recent growth metrics, particularly in earnings and EBITDA, indicate potential challenges ahead. Investors should weigh the stability of Kansai Electric Power Co Inc's dividends against these growth concerns and consider the company's ability to adapt to a changing energy landscape. Will Kansai Electric Power Co Inc's dividend continue to be a reliable source of income for investors? Only time will tell, but careful analysis of these factors will be crucial for informed investment decisions.
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.