December 03, 2025 a 02:46 am
📊 BF-B: Dividend Analysis - Brown-Forman Corporation
Brown-Forman Corporation exhibits a strong dividend history with steady yields and resilience over 41 years, despite recent cuts. The company showcases moderate dividend growth, ensuring investor confidence despite economic fluctuations.
Overview 📈
Brown-Forman Corporation, a stalwart in the Consumer Goods sector, offers a dividend yield of 3.05%. With dividends per share currently at $0.89, its reliable dividend history spans 41 years, marking its resilience and commitment to shareholders. Notably, the last dividend cut or suspension took place in 2022.
| Metric | Details |
|---|---|
| Sector | Consumer Goods |
| Dividend Yield | 3.05% |
| Current Dividend Per Share | $0.89 |
| Dividend History | 41 years |
| Last Cut or Suspension | 2022 |
Dividend History 📉
A solid dividend history reflects Brown-Forman's consistent shareholder value delivery, albeit with a recent cut in 2022 highlighting adaptive fiscal strategies to ensure long-term stability.
| Year | Dividend Per Share (USD) |
|---|---|
| 2025 | 0.9105 |
| 2024 | 0.8799 |
| 2023 | 0.8343 |
| 2022 | 0.7710 |
| 2021 | 1.7270 |
Dividend Growth 📈
While the 3-year growth is negative at -0.20%, the 5-year growth of 0.055% signals cautious optimism for potential upsides as market conditions stabilize.
| Time Frame | Growth |
|---|---|
| 3 years | -0.20% |
| 5 years | 0.055% |
The average dividend growth is 0.055% over 5 years. This shows moderate but steady dividend growth.
Payout Ratio ✅
The EPS-based payout ratio is 49.77%, while the free cash flow-based payout ratio is 71.92%. The relatively high FCF payout suggests a more aggressive approach to returning cash to shareholders.
| Key Figure | Ratio |
|---|---|
| EPS-based | 49.77% |
| Free Cash Flow-based | 71.92% |
Cashflow & Capital Efficiency 💰
Detailed analysis provides insight into Brown-Forman's cash efficiency and capital management, with metrics like Free Cash Flow Yield and CAPEX to Operating Cash Flow being crucial. Steady financial frameworks ensure CAPEX is effectively reinvested towards sustainable growth.
| 2023 | 2024 | 2025 | |
|---|---|---|---|
| Free Cash Flow Yield | 1.46% | 1.84% | 2.62% |
| Earnings Yield | 2.50% | 4.49% | 5.28% |
| CAPEX to Operating Cash Flow | 28.59% | 35.24% | 27.93% |
| Stock-based Compensation to Revenue | 0.43% | 0.60% | 0.70% |
| Free Cash Flow / Operating Cash Flow Ratio | 71.41% | 64.76% | 72.07% |
Balance Sheet & Leverage Analysis 🏦
The rigorous analysis indicates balanced leverage ratios and a robust capital structure. Key indicators like Debt-to-Equity and Net Debt to EBITDA are essential for understanding potential debt-related risks in volatile markets.
| 2023 | 2024 | 2025 | |
|---|---|---|---|
| Debt-to-Equity | 0.89 | 0.88 | 0.68 |
| Debt-to-Assets | 0.37 | 0.38 | 0.34 |
| Debt-to-Capital | 0.47 | 0.47 | 0.41 |
| Net Debt to EBITDA | 2.14 | 1.76 | 1.78 |
| Current Ratio | 3.51 | 2.59 | 2.79 |
| Quick Ratio | 1.40 | 0.95 | 1.56 |
| Financial Leverage | 2.38 | 2.32 | 2.03 |
Fundamental Strength & Profitability 📈
Brown-Forman excels in profitability metrics, as shown by robust ROE and ROA. A focus on operational margins underscores its competitive positioning, ensuring sustained profitability amidst market price pressures.
| 2023 | 2024 | 2025 | |
|---|---|---|---|
| Return on Equity | 23.96% | 29.12% | 21.76% |
| Return on Assets | 10.07% | 12.54% | 10.75% |
| Net Margin | 18.52% | 24.51% | 21.86% |
| EBIT Margin | 26.18% | 34.11% | 30.26% |
| EBITDA Margin | 28.07% | 36.19% | 32.45% |
| Gross Margin | 58.99% | 60.46% | 58.94% |
| R&D to Revenue | 0% | 0% | 0% |
Price Development 📊
Dividend Scoring System ✅
| Criteria | Score out of 5 | Score Bar |
|---|---|---|
| Dividend yield | 3 | |
| Dividend Stability | 4 | |
| Dividend Growth | 3 | |
| Payout Ratio | 3 | |
| Financial Stability | 4 | |
| Dividend Continuity | 4 | |
| Cashflow Coverage | 4 | |
| Balance Sheet Quality | 5 |
Total Score: 30/40
Rating 🗣️
Based on Brown-Forman's solid financial foundations and consistent dividend strategy, it is highly recommended for investors seeking steady income and potential capital appreciation. Maintaining vigilance on cash flow management will maximize its dividend-paying capacity.