International Paper Company exhibits a solid dividend history with an admirable continuity of 56 years without any cuts or suspensions. Despite recent challenges reflected in the performance metrics, the company's long-standing dividend policy inspires confidence. However, the payout ratios and recent dividend growth signals suggest areas for improvement.
The company's position within its sector suggests strong operational capabilities, particularly within the context of maintaining a stable dividend yield. However, potential investors should be cautious about the future sustainability given the elevated payout ratios.
Metric | Detail |
---|---|
Sector | Manufacturing |
Dividend yield | 3.88 % |
Current dividend per share | 1.85 USD |
Dividend history | 56 years |
Last cut or suspension | None |
The dividend history showcases consistency which is attractive for income-focused investors. This long dividend track establishes confidence in stable income generation.
Year | Dividend per Share (USD) |
---|---|
2025 | 0.9250 |
2024 | 1.8500 |
2023 | 1.8500 |
2022 | 1.8500 |
2021 | 1.9199 |
The analysis of dividend growth is vital for projecting future income streams. However, the negative growth rates in recent years require attention.
Time | Growth |
---|---|
3 years | -1.23 % |
5 years | -0.60 % |
The average dividend growth is -0.60 % over 5 years. This shows moderate but steady dividend growth in the face of challenging financial conditions.
Payout ratios offer insight into the sustainability of dividend payments. High ratios may suggest potential difficulties in maintaining current dividend levels.
Key figure | Ratio |
---|---|
EPS-based | 204.14 % |
Free cash flow-based | -19553.05 % |
The EPS payout ratio of 204.14 % and the FCF payout ratio of -19553.05 % signify concerning levels. These indicate the company potentially pays out more in dividends than its earnings and cash flows, raising questions about future payment sustainability.
Understanding cash flow and capital efficiency measures a company's ability to generate cash relative to its capital investment. This is crucial for sustaining operations and dividends.
Metric | 2023 | 2024 |
---|---|---|
Free Cash Flow Yield | 5.52 % | 4.05 % |
Earnings Yield | 2.30 % | 2.98 % |
CAPEX to Operating Cash Flow | 62.25 % | 54.89 % |
Stock-based Compensation to Revenue | 0.31 % | 0.26 % |
Free Cash Flow / Operating Cash Flow Ratio | 37.75 % | 45.11 % |
The cash flow indicators reflect marginally negative free cash flow yield, with relatively high levels of capital expenditure compared to cash from operations, highlighting the need for operational efficiency improvements.
Balance sheet strength is a core metric of financial health, assessing how well a company manages its debt load relative to its equity and physical assets.
Metric | 2024 | 2023 | 2022 |
---|---|---|---|
Debt-to-Equity | 0.72 | 0.71 | 0.69 |
Debt-to-Assets | 0.26 | 0.25 | 0.24 |
Debt-to-Capital | 0.42 | 0.41 | 0.41 |
Net Debt to EBITDA | 2.49 | 2.14 | 1.71 |
Overall, the balance sheet reveals manageable leverage, though increasing Net Debt to EBITDA warns of potential liquidity issues. The progressively stable debt ratios provide a degree of comfort regarding the company's ability to service its debt.
Profitability metrics, such as Return on Equity and Assets, are essential for assessing the efficiency and potential growth of a company. Margins provide insight into cost management and business stability.
Metric | 2024 | 2023 | 2022 |
---|---|---|---|
Return on Equity | 6.82 % | 3.45 % | 17.70 % |
Return on Assets | 2.44 % | 1.24 % | 6.28 % |
Net Margin | 2.99 % | 1.52 % | 7.11 % |
EBIT Margin | 3.10 % | 4.25 % | 9.04 % |
Gross Margin | 28.16 % | 27.95 % | 28.42 % |
The mixed performance in fundamental metrics over the past years suggests areas of operational challenges amidst maintaining profitability. High prior ROE and fluctuating margins underscore the variability in cost management efficiency that could impact future profitability.
Category | Score (1-5) | Score Bar |
---|---|---|
Dividend yield | 3 | |
Dividend Stability | 4 | |
Dividend growth | 2 | |
Payout ratio | 1 | |
Financial stability | 3 | |
Dividend continuity | 5 | |
Cashflow Coverage | 2 | |
Balance Sheet Quality | 3 |
The dividend outlook for International Paper Company is a mix of heritage and caution. While its historic stability stands out, the high payout ratios and negative growth suggest careful reevaluation for dividend-focused portfolios. It may still attract long-term investors valuing stability over short-term performance.