Yahoo Finance Prada SpA's Dividend Analysis
Assessing the Sustainability of Prada SpA's Upcoming Dividend
Prada SpA (PRDSF) recently announced a dividend of $1.13 per share, payable on 2024-05-17, with the ex-dividend date set for 2024-04-29. 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 Prada SpA's dividend performance and assess its sustainability.
What Does Prada SpA Do?
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Prada is a family-owned holding comprising the Prada brand, a younger and more fashion-oriented Miu Miu, and two classic shoe brands: Church's and Car Shoe. The company generates more than EUR 4.2 billion in sales, with almost 90% from the Prada brand. Leather goods make up 50% of retail sales, ready-to-wear 29%, footwear 18%, and licensing (mainly eyewear and fragrances) 3%. Geographically, Asia is the biggest region with 33% of retail sales, followed by Europe at 32%, 21% in the Americas, and 10% in Japan.
A Glimpse at Prada SpA's Dividend History
Prada SpA has maintained a consistent dividend payment record since 2021. Dividends are currently distributed on a yearly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Prada SpA's Dividend Yield and Growth
As of today, Prada SpA currently has a 12-month trailing dividend yield of 1.54% and a 12-month forward dividend yield of 1.86%. This suggests an expectation of increased dividend payments over the next 12 months.
Based on Prada SpA's dividend yield and five-year growth rate, the 5-year yield on cost of Prada SpA stock as of today is approximately 1.54%.
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, Prada SpA's dividend payout ratio is 0.50.
Prada SpA's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Prada SpA's profitability 8 out of 10 as of 2023-12-31, suggesting good profitability prospects. The company has reported net profit in 9 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. Prada SpA's growth rank of 8 out of 10 suggests that the company's growth trajectory is good relative to its competitors.
Revenue is the lifeblood of any company, and Prada SpA's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Prada SpA's revenue has increased by approximately 20.80% per year on average, a rate that outperforms approximately 82.81% of global competitors.
Next Steps for Investors
Considering Prada SpA's consistent dividend payments, a promising dividend growth rate, a prudent payout ratio, robust profitability, and strong growth metrics, the company's dividends appear sustainable. Investors seeking to diversify their portfolios with luxury retail stocks might find Prada SpA an attractive option. The upcoming dividend payment adds an additional incentive for those looking for steady income streams. As always, investors should conduct their own due diligence to ensure that any stock aligns with their investment strategy and financial goals. 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.