SBA Communications Corp's Dividend Analysis
Assessing the Sustainability of SBAC's Upcoming Dividend Payment
SBA Communications Corp(NASDAQ:SBAC) recently announced a dividend of $0.98 per share, payable on 2024-03-28, with the ex-dividend date set for 2024-03-13. 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 SBA Communications Corp's dividend performance and assess its sustainability.
What Does SBA Communications Corp Do?
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SBA Communications owns and operates almost 40,000 cell towers throughout North America, South America, and Africa. It leases space on its towers to wireless service providers, who install equipment on the towers to support their wireless networks. The company has a very concentrated customer base, with most revenue in each market being generated by just the top few mobile carriers. The company owns more than 17,000 towers in the U.S., which accounted for about 70% of the company's total revenue in 2023. Internationally, SBA's greatest presence is in Brazil, where it operates roughly 10,000 towers. SBA operates as a real estate investment trust, or REIT.
A Glimpse at SBA Communications Corp's Dividend History
SBA Communications Corp has maintained a consistent dividend payment record since 2019. Dividends are currently distributed on a quarterly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down SBA Communications Corp's Dividend Yield and Growth
As of today, SBA Communications Corp currently has a 12-month trailing dividend yield of 1.53% and a 12-month forward dividend yield of 1.76%. This suggests an expectation of increased dividend payments over the next 12 months. Over the past three years, SBA Communications Corp's annual dividend growth rate was 22.30%. Based on SBA Communications Corp's dividend yield and five-year growth rate, the 5-year yield on cost of SBA Communications Corp stock as of today is approximately 1.53%.
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, SBA Communications Corp's dividend payout ratio is 0.57. SBA Communications Corp's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks SBA Communications Corp's profitability 9 out of 10 as of 2023-12-31, suggesting good profitability prospects. The company has reported net profit in 8 years out of past 10 years.