NuStar Energy LP's Dividend Analysis
Assessing the Sustainability of NuStar Energy LP's Dividend Payments
NuStar Energy LP(NYSE:NS) recently announced a dividend of $0.4 per share, payable on 2024-02-13, with the ex-dividend date set for 2024-02-06. 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 NuStar Energy LP's dividend performance and assess its sustainability.
What Does NuStar Energy LP Do?
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NuStar Energy LP is a US-based pipeline and terminal operator. The company, along with its subsidiaries, is engaged in the transportation of petroleum products and anhydrous ammonia; the terminalling and storage of crude oil and specialty chemicals, and the marketing of petroleum products. Its business is organized into segments: Pipeline, Storage, and Fuels Marketing. Geographically, the company operates in the United States and abroad, deriving key revenue from the Pipeline business.
A Glimpse at NuStar Energy LP's Dividend History
NuStar Energy LP has maintained a consistent dividend payment record since 2001. Dividends are currently distributed on a quarterly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down NuStar Energy LP's Dividend Yield and Growth
As of today, NuStar Energy LP currently has a 12-month trailing dividend yield of 7.07% and a 12-month forward dividend yield of 7.07%. This suggests an expectation of the same dividend payments over the next 12 months.
Over the past three years, NuStar Energy LP's annual dividend growth rate was -12.60%. Extended to a five-year horizon, this rate decreased to -18.40% per year. And over the past decade, NuStar Energy LP's annual dividends per share growth rate stands at -11.40%.
Based on NuStar Energy LP's dividend yield and five-year growth rate, the 5-year yield on cost of NuStar Energy LP stock as of today is approximately 2.56%.
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 2023-09-30, NuStar Energy LP's dividend payout ratio is 2.89, which may suggest that the company's dividend may not be sustainable.