June 29, 2025 a 02:46 am
WST: Dividend Analysis - West Pharmaceutical Services, Inc.
West Pharmaceutical Services has a history of providing solid dividends with a strong growth trend over the past years. The company's commitment to returning value to shareholders is evident from its consistent dividend payments and growth. Recently, the dividend yield has been modest, yet the stability and potential for growth makes it an attractive stock for income-focused investors.
Overview 📊
West Pharmaceutical Services operates within a stable sector that provides a modest yet consistent dividend yield. This scenario is ideal for investors seeking income stability coupled with modest growth potential.
| Detail | Value |
|---|---|
| Sector | Healthcare |
| Dividend yield | 0.38% |
| Current dividend per share | 0.81 USD |
| Dividend history | 39 years |
| Last cut or suspension | None |
Dividend History 🗣️
With 39 years of consistent dividend payments, West Pharmaceutical showcases its resilience and commitment to shareholders. This is crucial for investors looking for reliable income sources.
| Year | Dividend Per Share (USD) |
|---|---|
| 2025 | 0.63 |
| 2024 | 0.81 |
| 2023 | 0.77 |
| 2022 | 0.73 |
| 2021 | 0.69 |
Dividend Growth 📈
The historical dividend growth reflects a commitment to steadily increasing shareholder returns. Such growth is vital for counteracting inflation and providing compounded income growth.
| Time | Growth |
|---|---|
| 3 years | 5.49% |
| 5 years | 5.83% |
The average dividend growth is 5.83% over 5 years. This shows moderate but steady dividend growth.
Payout Ratio ✅
Payout ratios are a great indicator of dividend sustainability. It highlights the portion of earnings and cash flows paid as dividends, ensuring the company is not overextending itself.
| Key figure | Ratio |
|---|---|
| EPS-based | 12.56% |
| Free cash flow-based | 18.95% |
The low payout ratios of 12.56% (EPS) and 18.95% (FCF) indicate a highly sustainable dividend with room for future increases.
Cashflow & Capital Efficiency 💰
Analyzing cash flows and capital efficiency offers insights into operational performance and financial health, essential for sustaining dividends and capital reinvestments.
| Metric | 2024 | 2023 | 2022 |
|---|---|---|---|
| Free Cash Flow Yield | 1.16% | 1.58% | 2.51% |
| Earnings Yield | 2.06% | 2.27% | 3.35% |
| CAPEX to Operating Cash Flow | 57.70% | 46.62% | 39.31% |
| Stock-based Compensation to Revenue | 0.65% | 0.79% | 0.82% |
| Free Cash Flow / Operating Cash Flow Ratio | 42.30% | 53.38% | 60.69% |
The cash flow metrics suggest a stable cash-generating capability, ensuring capital efficiency and dividend stability.
Balance Sheet & Leverage Analysis ⚖️
The balance sheet and leverage ratios provide a window into company stability and risk. They reflect on the company’s ability to manage debt and liquidity.
| Metric | 2024 | 2023 | 2022 |
|---|---|---|---|
| Debt-to-Equity | 0.11 | 0.11 | 0.12 |
| Debt-to-Assets | 0.08 | 0.08 | 0.09 |
| Debt-to-Capital | 0.10 | 0.10 | 0.11 |
| Net Debt to EBITDA | -0.25 | -0.65 | -0.65 |
| Current Ratio | 0.00 | 0.00 | 3.70 |
| Quick Ratio | 2.11 | 2.24 | 2.90 |
| Financial Leverage | 1.36 | 1.33 | 1.35 |
The low leverage and strong solvency ratios indicate a robust balance sheet position, favorable for dividend consistency.
Fundamental Strength & Profitability 📉
Profitability ratios are crucial for assessing long-term growth and sustainability. They reflect how well the company utilizes its resources to generate profit.
| Metric | 2024 | 2023 | 2022 |
|---|---|---|---|
| Return on Equity | 18.37% | 20.60% | 21.82% |
| Return on Assets | 13.52% | 15.50% | 16.20% |
| Net Margin | 17.03% | 20.12% | 20.30% |
| EBIT Margin | 20.34% | 23.97% | 23.82% |
| EBITDA Margin | 25.71% | 28.61% | 30.76% |
| Gross Margin | 34.51% | 38.28% | 39.36% |
| R&D to Revenue | 2.39% | 2.32% | 2.03% |
Consistent profitability across metrics underscores strong competitive positioning and management efficacy, supporting sustained dividends.
Price Development
Dividend Scoring System 📏
| Criteria | Score | Score Bar |
|---|---|---|
| Dividend yield | 3 | |
| Dividend Stability | 5 | |
| Dividend growth | 4 | |
| Payout ratio | 5 | |
| Financial stability | 5 | |
| Dividend continuity | 5 | |
| Cashflow Coverage | 4 | |
| Balance Sheet Quality | 5 |
Overall Score: 36/40
Rating 🌟
West Pharmaceutical Services, Inc. receives a highly favorable dividend rating. With its stable and growing dividend yield, outstanding payout stability, and robust financial health, this stock is highly recommended for income-focused investors seeking long-term growth and income security.