April 21, 2025 a 11:31 am
CHD: Dividend Analysis - Church & Dwight Co., Inc.
Church & Dwight Co., Inc., with its robust dividend history of 41 years and a commitment to dividend payouts, exhibits a reliable financial strategy. A current dividend yield of 1.09% reflects moderate returns, driven by calculated growth and a consistent payout strategy. Despite a modest dividend yield, the company's financial health is marked by a strong balance sheet and stable cash flows, indicating sustainability in future payouts.
📊 Overview
Church & Dwight operates in a mature sector with a current dividend yield of 1.09%. The company has successfully maintained a dividend history spanning over 41 years without any reductions or suspensions, showcasing its commitment to returning value to shareholders.
| Key Metric | Value |
|---|---|
| Sector | Consumer Goods |
| Dividend Yield | 1.09% |
| Current Dividend Per Share | 1.12 USD |
| Dividend History | 41 years |
| Last Cut or Suspension | None |
📈 Dividend History
The resilience of Church & Dwight's dividends over four decades indicates its solid financial management and consistent cash flow generation. This kind of unbroken record is especially important for investors seeking stable income.
| Year | Dividend Per Share (USD) |
|---|---|
| 2025 | 0.295 |
| 2024 | 1.135 |
| 2023 | 1.090 |
| 2022 | 1.050 |
| 2021 | 1.010 |
📊 Dividend Growth
The company's dividend growth rates are indicative of its financial stability. Over the past five years, the dividends have grown at an average rate of 4.52%, exemplifying a moderate yet consistent increase that supports long-term shareholder value.
| Time | Growth |
|---|---|
| 3 years | 3.97% |
| 5 years | 4.52% |
The average dividend growth is 4.52% over 5 years. This shows moderate but steady dividend growth.
🗣️ Payout Ratio
The EPS-based payout ratio stands at 47.74%, while the free cash flow-based ratio is 28.27%. These figures suggest that Church & Dwight is effectively balancing its dividend obligations with earnings and cash flows, allowing room for reinvestment and growth.
| Key Figure | Ratio |
|---|---|
| EPS-based | 47.74% |
| Free Cash Flow-based | 28.27% |
A payout ratio of 47.74% (EPS) and 28.27% (FCF) is indicative of a sustainable dividend policy, supporting both growth and shareholder returns.
🗣️ Cashflow & Capital Efficiency
Effective cash flow management is pivotal. With a free cash flow yield of 3.77% and a free cash flow to operating cash flow ratio of 84.45%, Church & Dwight emphasizes efficient cash utilization and investment strategy, ensuring sufficient liquidity for operational demands.
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Free Cash Flow Yield | 3.61% | 3.49% | 3.78% |
| Earnings Yield | 2.11% | 3.26% | 2.26% |
| CAPEX to Operating Cash Flow | 20.20% | 21.69% | 15.55% |
| Stock-based Compensation to Revenue | 0.60% | 1.08% | 0.97% |
| Free Cash Flow / Operating Cash Flow Ratio | 79.80% | 78.31% | 84.45% |
| Return on Invested Capital | 6.53% | 11.24% | 8.25% |
Both the cash flow and capital efficiency metrics affirm Church & Dwight's commitment to strategic investments and robust cash management, creating strong foundations for future growth.
📊 Balance Sheet & Leverage Analysis
An analysis of the balance sheet metrics reveals that Church & Dwight has maintained a healthy leverage profile. With a debt-to-equity ratio declining from 76.61% in 2022 to 50.55% in 2024, the company is showcasing effective debt management strategies and maintaining financial flexibility.
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Debt-to-Equity | 76.61% | 67.58% | 50.55% |
| Debt-to-Assets | 32.03% | 30.41% | 24.82% |
| Debt-to-Capital | 43.38% | 40.33% | 33.58% |
| Net Debt to EBITDA | 2.91 | 1.73 | 1.14 |
| Current Ratio | 1.18 | 1.08 | 1.70 |
| Quick Ratio | 63.30% | 64.44% | 123.66% |
| Financial Leverage | 239.14% | 222.26% | 203.70% |
These leverage metrics highlight sound financial stewardship, setting a conducive environment for strategic capital allocation and risk management.
🗣️ Fundamental Strength & Profitability
Key profitability metrics for Church & Dwight demonstrate a robust financial structure, with a Return on Equity of 13.02% in 2024, reflective of effective operational management and value addition to shareholders' equity.
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Return on Equity | 11.86% | 19.60% | 13.42% |
| Return on Assets | 4.96% | 8.82% | 6.59% |
| Net Margin | 7.70% | 12.88% | 9.58% |
| EBIT Margin | 11.40% | 18.38% | 13.94% |
| EBITDA Margin | 15.37% | 22.21% | 17.85% |
| Gross Margin | 41.86% | 44.11% | 45.69% |
| Research & Development to Revenue | 2.05% | 2.09% | N/A |
Profitability indicators signify Church & Dwight's ability to generate attractive returns, thereby underpinning the company's strong market position and operational excellence.
Price Development
The stock price patterns over the years showcase the market's trust in Church & Dwight's consistent growth strategy and durable market presence.
✅ Dividend Scoring System
This scoring system evaluates key dividend-relevant metrics of Church & Dwight, providing a comprehensive assessment of its dividend health and potential risks.
| Category | Score | Score Bar |
|---|---|---|
| Dividend yield | 3 / 5 | |
| Dividend Stability | 5 / 5 | |
| Dividend growth | 4 / 5 | |
| Payout ratio | 4 / 5 | |
| Financial stability | 5 / 5 | |
| Dividend continuity | 5 / 5 | |
| Cashflow Coverage | 4 / 5 | |
| Balance Sheet Quality | 4 / 5 |
Total Score: 34 / 40
Rating
Given the comprehensive analysis across multiple metrics, Church & Dwight Co., Inc. is rated highly for its dividend health, stability, and strong financial foundation. Investors seeking reliable dividend income with moderate growth potential will find Church & Dwight a valuable addition to their portfolio. Therefore, the recommendation is to consider Church & Dwight as a solid investment opportunity.