November 29, 2025 a 03:31 pm
GPC: Dividend Analysis - Genuine Parts Company
Genuine Parts Company (GPC) presents a robust dividend profile with a commendable history of payouts. With 43 consecutive years of dividend payments, its commitment to returning value to shareholders is evident. However, the high free cash flow payout ratio indicates a heavy reliance on earnings for sustainability, necessitating cautious optimism.
Overview 📊
Genuine Parts Company operates in the sector with a dividend yield of 3.16%. The current dividend per share is $3.99, with a history of 43 years of dividends without a cut since 1986.
| Sector | Dividend Yield | Current Dividend Per Share | Dividend History | Last Cut or Suspension |
|---|---|---|---|---|
| Sector Name | 3.16% | $3.99 | 43 years | 1986 |
Dividend History 🗣️
The dividend history of GPC highlights reliability and shareholder value with consistent payments over decades, demonstrating stability even in fluctuating market conditions.
| Year | Dividend Per Share |
|---|---|
| 2025 | $4.12 |
| 2024 | $4.00 |
| 2023 | $3.80 |
| 2022 | $3.58 |
| 2021 | $3.26 |
Dividend Growth 📈
Analyzing the growth of dividends over the past years is crucial for understanding the company's future dividend sustainability and shareholder return expectations. GPC shows moderate growth over a 3 to 5-year horizon, reflecting a steady but cautious increase.
| Time | Growth |
|---|---|
| 3 years | 7.06% |
| 5 years | 5.57% |
The average dividend growth is 5.57% over 5 years. This shows moderate but steady dividend growth.
Payout Ratio ✅
Payout ratios are critical in assessing the sustainability of a company's dividend payments. A balanced ratio ensures that dividends are supported by actual earnings and cash flow.
| Key Figure | Ratio |
|---|---|
| EPS-based | 68.58% |
| Free cash flow-based | 415.29% |
The EPS payout ratio of 68.58% suggests dividends are comfortably covered by earnings. However, the high free cash flow payout ratio of 415.29% raises concerns over the dividend's coverage through operational cash flows.
Cashflow & Capital Efficiency 💰
Evaluating cashflow and capital efficiency provides insight into how effectively a company generates and utilizes its capital resources. This analysis is crucial for dividend sustainability and corporate growth potential.
| Year | 2024 | 2023 | 2022 |
|---|---|---|---|
| Free Cash Flow Yield | 4.21% | 4.75% | 4.59% |
| Earnings Yield | 5.56% | 6.77% | 4.82% |
| CAPEX to Operating Cash Flow | 45.34% | 35.71% | 23.15% |
| Stock-based Compensation to Revenue | 0.17% | 0.25% | 0.17% |
| Free Cash Flow / Operating Cash Flow Ratio | 54.66% | 64.29% | 76.85% |
The analysis indicates that Genuine Parts Company's capital efficiency is currently sustainable but may face challenges in maintaining free cash flow if revenue or earnings fluctuate significantly.
Balance Sheet & Leverage Analysis 📊
The balance sheet and leverage analysis are essential for understanding financial stability, liquidity, and the company's ability to handle debt obligations and growth investments.
| Year | 2024 | 2023 | 2022 |
|---|---|---|---|
| Debt-to-Equity | 1.32 | 1.11 | 1.10 |
| Debt-to-Assets | 29.78% | 27.19% | 25.25% |
| Debt-to-Capital | 56.97% | 52.61% | 52.35% |
| Net Debt to EBITDA | 3.13 | 1.75 | 1.76 |
| Current Ratio | 1.16 | 1.23 | 1.15 |
| Quick Ratio | 0.51 | 0.63 | 0.57 |
| Financial Leverage | 4.45 | 4.08 | 4.35 |
The company's financial stability is underpinned by a stable leverage ratio; however, a significant part of its capital structure relies on debt, underscoring the need for careful liquidity management.
Fundamental Strength & Profitability 📈
Assessing fundamental strength and profitability metrics provides an indication of the company’s operational efficiency and its ability to generate returns on investments and equity.
| Year | 2024 | 2023 | 2022 |
|---|---|---|---|
| Return on Equity | 20.84% | 29.91% | 31.20% |
| Return on Assets | 4.69% | 7.33% | 7.17% |
| EBIT Margin | 5.42% | 7.82% | 7.45% |
| EBITDA Margin | 7.16% | 9.34% | 9.03% |
| Gross Margin | 36.29% | 35.90% | 35.03% |
| R&D to Revenue | 0% | 0% | 0% |
While Genuine Parts Company demonstrates strong profitability ratios, there is an opportunity to enhance return on asset and equity ratios through strategic investments and innovations.
Price Development 📉
Dividend Scoring System 🔍
An evaluation of Genuine Parts Company's dividends across several dimensions offers a comprehensive perspective on its dividend attractiveness.
| Criteria | Score (1 to 5) | Visual Score |
|---|---|---|
| Dividend Yield | 4 | |
| Dividend Stability | 5 | |
| Dividend Growth | 3 | |
| Payout Ratio | 2 | |
| Financial Stability | 3 | |
| Dividend Continuity | 5 | |
| Cashflow Coverage | 3 | |
| Balance Sheet Quality | 4 |
Total Score: 29/40
Rating 🏆
Genuine Parts Company holds a strong dividend profile characterized by long-term stability and moderate growth. Despite some concerns about cash flow coverage and payout ratios, the company's commitment to dividends makes it appealing to long-term investment strategies.