C.H. Robinson Worldwide, Inc. (NASDAQ:CHRW), a prominent transportation and logistics company, recently announced that it will be paying a dividend of $0.61 per share on January 2nd. With a dividend yield of approximately 3.0%, this payment appears to be in line with industry norms.
Examining the sustainability of a dividend is crucial for investors, as a consistent payout over the long term is desirable. While the last dividend payment represented 74% of earnings, robust cash flows suggest that there is ample room for reinvestment in the business. This bodes well for the company’s ability to maintain its dividend payments.
Looking ahead, the projected growth in earnings per share for the next year is an impressive 64.6%. If this growth trend continues, the payout ratio could decrease to 47% by next year, indicating a sustainable range for dividend payments.
C.H. Robinson Worldwide has a commendable track record when it comes to dividends. Since 2013, the annual dividend payment has steadily increased from $1.40 to $2.44, reflecting a growth rate of 5.7% per year. This consistent growth has provided shareholders with a reliable source of income.
However, it is important to note that the company’s earnings per share have declined at a rate of 5.8% per year over the last five years. This decline raises concerns regarding the company’s ability to sustain its dividend growth. While there is a forecasted earnings growth in the next 12 months, it would be prudent to monitor the situation closely before considering it a stable pattern.
In summary, C.H. Robinson Worldwide presents itself as a solid choice for dividend investors, despite the absence of a dividend increase this year. The sustainability of the dividend appears promising, but a cautious approach may be warranted due to declining earnings.
Interested investors should consider additional factors when analyzing stock performance. We have identified two warning signs for C.H. Robinson Worldwide that may be worth exploring before making any investment decisions. For dividend-focused individuals, we have also compiled a list of high-yield dividend stocks for your consideration.
1. What is the dividend yield for C.H. Robinson Worldwide?
As of the upcoming dividend payment on January 2nd, the dividend yield for C.H. Robinson Worldwide is approximately 3.0%.
2. How sustainable is the company’s dividend?
C.H. Robinson Worldwide’s dividend appears to be sustainable, as robust cash flows suggest that there is ample room for reinvestment in the business. Moreover, the projected earnings growth for the next year indicates a potential decrease in the payout ratio, further supporting the sustainability of the dividend.
3. Has C.H. Robinson Worldwide consistently increased its dividends?
Yes, C.H. Robinson Worldwide has a stable history of increasing its dividends. Over the years, the annual dividend payment has steadily grown from $1.40 in 2013 to $2.44 most recently, reflecting a growth rate of 5.7% per year.
4. What concerns should investors be aware of?
Investors should be aware of the declining earnings per share for C.H. Robinson Worldwide over the last five years, which raises concerns about the company’s ability to sustain its dividend growth. While there is projected earnings growth in the next 12 months, it is important to monitor the situation closely to ascertain a stable pattern.