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Iberdrola SA's Dividend Analysis

Exploring the Sustainability and Growth of Iberdrola SA's Dividends

Iberdrola SA (IBDRY) recently announced a dividend of $0.02 per share, payable on an unspecified future date, with the ex-dividend date set for 2024-05-09. Investors are keenly anticipating this upcoming payment, prompting a closer look at the company's dividend history, yield, and growth rates. Utilizing data from GuruFocus, this analysis delves into the performance and sustainability of Iberdrola SA's dividends.

What Does Iberdrola SA Do?

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Iberdrola SA is a global powerhouse in the utilities sector, with operations in nearly 40 countries and a diverse 56-gigawatt energy portfolio that includes hydro, wind, natural gas, and nuclear sources. Notably, wind farms constitute about 40% of its portfolio, making it the world's largest owner of wind energy assets. While Iberdrola SA has expanded its reach globally, Spain remains a critical market, hosting approximately 50% of its power generation capacity. The company also manages extensive electricity and distribution networks in Spain, the UK, Brazil, and the US.

Iberdrola SA's Dividend Analysis
Iberdrola SA's Dividend Analysis

A Glimpse at Iberdrola SA's Dividend History

Since 2007, Iberdrola SA has upheld a reliable dividend payment schedule, distributing dividends bi-annually. This steadfast approach highlights the company's commitment to shareholder returns.

Iberdrola SA's Dividend Analysis
Iberdrola SA's Dividend Analysis

Breaking Down Iberdrola SA's Dividend Yield and Growth

Iberdrola SA boasts a trailing and forward dividend yield of 4.45%, indicating stable dividend expectations over the next 12 months. The company's dividend growth rates vary, with a three-year annual decline of 7.60%, a five-year growth of 4.80% per annum, and an impressive ten-year growth rate of 23.80%. These figures culminate in a 5-year yield on cost for Iberdrola SA stock at approximately 5.63% today.

Iberdrola SA's Dividend Analysis
Iberdrola SA's Dividend Analysis

The Sustainability Question: Payout Ratio and Profitability

The dividend payout ratio, currently at 0.57, suggests that Iberdrola SA retains a substantial portion of its earnings, which supports both sustainability and potential growth. The company's profitability rank of 8 out of 10 further underscores its robust financial health, reinforced by consistent positive net income over the past decade.

Growth Metrics: The Future Outlook

Iberdrola SA's growth rank of 8 out of 10 reflects its strong competitive position. The company's revenue per share has grown by an average of 15.30% annually, outperforming 72.64% of its global competitors. Additionally, its 3-year EPS growth rate of 12.20% and a 5-year EBITDA growth rate of 10.20% further demonstrate its growth potential and ability to sustain dividends.

Conclusion: Assessing Dividend Stability and Growth Prospects

Considering Iberdrola SA's consistent dividend payouts, robust yield percentages, and strong financial health, the company presents a compelling case for dividend investors. The blend of a stable payout ratio, consistent profitability, and promising growth metrics suggests that Iberdrola SA is well-positioned to continue delivering shareholder value through its dividend payments. For those looking to explore further, GuruFocus Premium offers tools like the High Dividend Yield Screener to discover other high-yielding stock 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.

This article first appeared on GuruFocus.