Yahoo Finance Northern Trust Corp's Dividend Analysis
Exploring the Sustainability and Growth of Dividends at Northern Trust Corp
Northern Trust Corp (NASDAQ:NTRS) recently announced a dividend of $0.75 per share, payable on 2024-07-01, with the ex-dividend date set for 2024-06-07. 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 Northern Trust Corp's dividend performance and assess its sustainability.
What Does Northern Trust Corp Do?
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Northern Trust is a leading provider of wealth management, asset servicing, asset management, and banking to corporations, institutions, affluent families, and individuals. Founded in Chicago in 1889, Northern Trust has offices in 20 states and Washington, D.C. as well as 23 locations in Canada, Europe, the Middle East, and Asia-Pacific. As of Dec. 31, 2023, Northern Trust had assets under custody or administration of $15.4 trillion and assets under management of $1.4 trillion.
A Glimpse at Northern Trust Corp's Dividend History
Northern Trust Corp has maintained a consistent dividend payment record since 1989, distributing dividends on a quarterly basis. It has increased its dividend each year since 1989, earning its status as a dividend aristocrat. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Northern Trust Corp's Dividend Yield and Growth
As of today, Northern Trust Corp currently has a 12-month trailing dividend yield of 3.66% and a 12-month forward dividend yield of 3.66%, indicating stable dividend expectations. Over the past three years, Northern Trust Corp's annual dividend growth rate was 2.30%, increasing to 7.40% per year over five years, and an impressive 11.00% over the past decade. The 5-year yield on cost of Northern Trust Corp stock as of today is approximately 5.23%.
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 of 0.64 as of 2024-03-31 suggests that Northern Trust Corp retains a significant part of its earnings, ensuring funds for future growth and downturns. Its profitability rank of 6 out of 10, combined with a decade of positive net income, indicates fair profitability.
Growth Metrics: The Future Outlook
Robust growth metrics are crucial for the sustainability of dividends. Northern Trust Corp's growth rank of 6 suggests a fair growth outlook. Its revenue per share and 3-year revenue growth rate of 3.80% per year, although underperforming 55.66% of global competitors, combined with a 3-year EPS growth rate of -1.50% and a 5-year EBITDA growth rate of -3.10%, highlights areas for potential improvement.
Conclusion: Evaluating Dividend Sustainability
Considering Northern Trust Corp's consistent dividend payments, growth rates, payout ratio, and profitability, the dividends appear sustainable in the near term. However, the company's underperforming growth metrics compared to its peers suggest potential areas for strategic enhancement. As Northern Trust Corp navigates the complexities of market conditions, investors should keep a close watch on these indicators.
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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.
