May 01, 2025 a 07:31 am
MO: Dividend Analysis - Altria Group, Inc.
Altria Group, Inc. boasts a robust track record of consistent dividend payments spanning over five decades. Despite challenges in the macroeconomic environment, the company's dividend yield remains attractive to income-focused investors. The reliability and continuity of Altria's dividends, coupled with moderate growth, make it a noteworthy option for those seeking steady income. However, the company's high payout ratios and leverage should be carefully monitored.
📊 Overview
Altria operates within the diverse consumer staples sector, renowned for its stable revenue streams and robust dividend policies. The following table highlights key aspects of Altria's dividend profile that may influence investment decisions:
| Metric | Value |
|---|---|
| Sector | Consumer Staples |
| Dividend Yield | 7.12% |
| Current Dividend per Share | 3.98 USD |
| Dividend History | 56 years |
| Last Cut or Suspension | None |
🗣️ Dividend History
With a legacy of stable dividend payments, investors can rely on Altria's consistent historical performance as an indicator of future stability. Long-term dividend history is crucial for assessing the resilience of income streams.
| Year | Dividend Per Share |
|---|---|
| 2025 | 1.02 USD |
| 2024 | 4.00 USD |
| 2023 | 3.84 USD |
| 2022 | 3.68 USD |
| 2021 | 3.52 USD |
📈 Dividend Growth
The assessment of dividend growth offers insights into the company's capacity for enhancing shareholder value. Sustainable growth rates indicate the management's commitment to rewarding shareholders.
| Time | Growth |
|---|---|
| 3 years | 4.35% |
| 5 years | 4.05% |
The average dividend growth over the past 5 years is 4.05%, indicating moderate but steady growth.
📉 Payout Ratio
Payout ratios are critical in determining the sustainability of dividends. A balance between returning income to shareholders and retaining earnings for growth initiatives is crucial.
| Key Figure | Ratio |
|---|---|
| EPS-based | 65.94% |
| Free Cash Flow-based | 79.50% |
The EPS payout ratio of 65.94% and the FCF payout ratio of 79.50% suggest a moderately high but manageable commitment to shareholder returns. However, continuous monitoring is essential to avoid unsustainable payouts.
✅ Cashflow & Capital Efficiency
A comprehensive analysis of cash flows and capital efficiency reveals the company's capacity to generate cash and utilize capital effectively. These metrics are indicative of financial health and flexibility.
| Year | 2022 | 2023 | 2024 |
|---|---|---|---|
| Free Cash Flow Yield | 9.76% | 12.78% | 9.58% |
| Earnings Yield | 6.99% | 11.43% | 12.54% |
| CAPEX to Operating Cash Flow | 2.48% | 2.11% | 1.62% |
| Stock-Based Compensation to Revenue | 0.24% | 0.28% | 0% |
| Free Cash Flow / Operating Cash Flow Ratio | 97.5% | 97.9% | 98.4% |
The cash flow metrics reflect strong cash generation capability and prudent capital deployment, essential for sustaining dividends and facilitating growth.
💼 Balance Sheet & Leverage Analysis
Analyzing the balance sheet provides insights into the company's leverage and financial stability. A solid debt structure ensures resilience against market fluctuations.
| Year | 2022 | 2023 | 2024 |
|---|---|---|---|
| Debt-to-Equity | -6.71 | -7.41 | -11.14 |
| Debt-to-Assets | 72.2% | 68.0% | 70.9% |
| Debt-to-Capital | 1.17 | 1.16 | 1.10 |
| Net Debt to EBITDA | 1.81 | 1.83 | 1.45 |
| Current Ratio | 0.84 | 0.49 | 0.51 |
| Quick Ratio | 0.70 | 0.39 | 0.39 |
The debt levels, represented by negative Debt-to-Equity ratios, indicate high leverage. This necessitates vigilant management to maintain the company's creditworthiness and financial health.
🔍 Fundamental Strength & Profitability
Fundamental analysis examines profitability and operational efficiency, critical for long-term sustainability and value creation.
| Year | 2022 | 2023 | 2024 |
|---|---|---|---|
| Return on Equity | -1.45% | -2.30% | -5.03% |
| Return on Assets | 0.16% | 0.21% | 0.32% |
| Return on Invested Capital | 0.22% | 0.30% | 0.33% |
| Net Margin | 27.9% | 39.7% | 55.1% |
| EBIT Margin | 41.2% | 58.9% | 72.3% |
| EBITDA Margin | 60.6% | 60.2% | 73.7% |
The negative Return on Equity across recent years is concerning, although market conditions and strategic decisions could influence these metrics.
📉 Price Development
🎯 Dividend Scoring System
| Criteria | Score | |
|---|---|---|
| Dividend Yield | 4 | |
| Dividend Stability | 5 | |
| Dividend Growth | 3 | |
| Payout Ratio | 3 | |
| Financial Stability | 2 | |
| Dividend Continuity | 5 | |
| Cashflow Coverage | 4 | |
| Balance Sheet Quality | 2 |
Total Score: 28/40
🗳️ Rating
Altria Group, Inc. presents a compelling investment opportunity for income-focused investors due to its robust dividend yield and history of stability. However, caution is advised due to the elevated payout ratios and leverage, which could affect financial stability. Investors should consider their risk appetite and long-term objectives when assessing this stock for their portfolios.