Explore Manulife Financial Corporation's dividend performance and sustainability
Manulife Financial Corp. (NYSE:MFC) recently announced a dividend of $0.4 per share, payable on June 19, 2024, with an ex-dividend date of May 21, 2024. The company's dividend history, yield, and growth rate are also in focus as investors look forward to future payouts. Let's examine Manulife Financial Corp's dividend history and assess its sustainability using data from GuruFocus.
What does Manulife Financial Corporation do?
Manulife Financial provides life insurance, annuity and wealth management products to individual and institutional clients in Canada, the United States and Asia. The company's investment management business contributes approximately 20% to its revenue and has approximately C$1.5 trillion in assets under management and administration as of the end of 2023. Its U.S. operations, primarily operated under the John Hancock brand, contribute approximately 27% of revenues and are primarily focused on providing insurance products for the protection of property, business and income. . The Asia segment provides insurance products and insurance-based savings products in more than 11 countries and accounts for approximately 30% of revenues. The Canadian operating segment represents approximately 23% of revenue.
A glimpse of Manulife Financial Corporation's dividend history
Manulife Financial Corp. has maintained a consistent dividend payment record since 2000. Dividends are currently distributed on a quarterly basis. Manulife Financial Corporation has increased its dividend every year since 2011. As such, the stock is listed as a Dividend Achiever, an honor bestowed on companies that have increased their dividends every year for at least the past 13 years. Below is a graph showing his annual dividend per share to track historical trends.
Analyzing Manulife Financial Corp.'s dividend yield and growth
As of today, Manulife Financial Corporation's trailing 12-month dividend yield is 4.18% and its trailing 12-month dividend yield is 4.36%. This suggests that dividend increases are expected over the next 12 months.
Over the past three years, Manulife Financial Corp.'s annual dividend growth rate was 9.20%. When extended to a five-year period, this rate increased to 9.70% per year. Over the past 10 years, Manulife Financial Corp.'s annual dividend growth rate per share has been an impressive 10.80%. Based on Manulife Financial Corp.'s dividend yield and five-year growth rate, his five-year cost yield for Manulife Financial Corp. stock as of today is approximately 6.64%.
Questions about sustainability: Dividend payout ratio and profitability
To assess dividend sustainability, you need to evaluate a company's payout ratio. Dividend payout ratio helps determine the proportion of a company's profits that it distributes as dividends. A low ratio indicates that the company is retaining a significant portion of its earnings, thereby ensuring that it has funds for future growth or unexpected economic downturns. As of March 31, 2024, Manulife Financial Corporation's dividend payout ratio is 0.42.
Manulife Financial Corporation's Profitability Rank helps you understand the company's earning power compared to its peers. GuruFocus ranks Manulife Financial Corporation's profitability with his score of 5 out of 10 as of March 31, 2024, suggesting fair profitability. The company has posted a net profit in nine of the past 10 years.
Growth indicators: future outlook
To ensure dividend sustainability, companies must have solid growth metrics. Manulife Financial Corp.'s Growth Rank of 5 out of 10 suggests that the company has decent growth prospects.
Earnings are the lifeblood of any company, and Manulife Financial Corporation's earnings per share combined with its three-year earnings growth rate suggest a strong earnings model. Manulife Financial Corporation's earnings grew at an average annual rate of approximately -16.60%. Performance below approximately 90.53% of global competitors.
The company's three-year EPS growth rate indicates its ability to grow earnings, which is a key factor in maintaining a dividend over the long term. Over the past three years, Manulife Financial Corp.'s earnings have grown by an average of -1.70% per year. Performance below approximately 67.08% of global competitors.
Finally, the company’s 5-year EBITDA growth rate is 0.20%. Performance below approximately 69.13% of global competitors.
Conclusion: Assessing Manulife Financial Corporation's dividend sustainability.
Considering Manulife Financial Corp.'s consistent dividend history and reasonable payout ratio, the dividend appears sustainable in the short term. However, the company's sales and profit growth have been lagging compared to global competitors, and it may be difficult to maintain long-term dividend growth without operational improvements. Investors should pay attention to these metrics when considering a stock's dividend prospects. If you want to dig deeper, GuruFocus Premium users can screen for high dividend yield stocks using the High Dividend Yield Screener.
This article created by GuruFocus is intended to provide general insight and is not intended as financial advice. Our commentary is based on historical data and analyst forecasts using an unbiased methodology and is not intended to serve as specific investment guidance. It does not constitute a recommendation to buy or sell stocks, and does not take into account your individual investment objectives or financial situation. Our objective is to provide fundamental data-driven analysis over time. Please note that our analysis may not incorporate the latest announcements or qualitative information from price-sensitive companies. GuruFocus has no position in the stocks mentioned herein.
This article first appeared on GuruFocus.
