Xylem Inc's Dividend Analysis
Exploring the Sustainability and Growth of Xylem Inc's Dividends
Xylem Inc (NYSE:XYL) recently announced a dividend of $0.36 per share, payable on 2024-03-20, with the ex-dividend date set for 2024-02-20. 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 Xylem Inc's dividend performance and assess its sustainability.
What Does Xylem Inc Do?
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Xylem is a global leader in water technology and offers a wide range of solutions, including the transport, treatment, testing, and efficient use of water for customers in the utility, industrial, commercial, and residential sectors. Xylem was spun off from ITT in 2011. Based in Rye Brook, New York, Xylem has a presence in over 150 countries and employs 16,200. The company generated $7.4 billion in revenue in 2023.
A Glimpse at Xylem Inc's Dividend History
Xylem Inc has maintained a consistent dividend payment record since 2011, distributing dividends on a quarterly basis. The company has also increased its dividend each year since its inception, earning it the status of a dividend achiever, a prestigious recognition for companies with at least 13 consecutive years of dividend increases.
Below is a chart showing the annual Dividends Per Share for tracking historical trends.
Breaking Down Xylem Inc's Dividend Yield and Growth
As of today, Xylem Inc currently has a 12-month trailing dividend yield of 1.07% and a 12-month forward dividend yield of 1.16%, indicating an expectation of increased dividend payments over the next year.
Over the past three years, Xylem Inc's annual dividend growth rate was 8.30%. This rate increased to 9.00% per year over a five-year period, and over the past decade, the annual dividends per share growth rate stands at an impressive 11.50%.
Based on Xylem Inc's dividend yield and five-year growth rate, the 5-year yield on cost for Xylem Inc stock as of today is approximately 1.65%.
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. As of 2023-12-31, Xylem Inc's dividend payout ratio is 0.36, suggesting a sustainable dividend policy.