Jul 01, 2023
Edgewell Personal Care (NYSE:EPC) Has Announced A Dividend Of $0.15
Stock Analysis Edgewell Personal Care Company (NYSE:EPC) has announced that it will pay a dividend of $0.15 per share on the 4th of October. This payment means the dividend yield will be 1.5%, which
Edgewell Personal Care Company (NYSE:EPC) has announced that it will pay a dividend of $0.15 per share on the 4th of October. This payment means the dividend yield will be 1.5%, which is below the average for the industry.
View our latest analysis for Edgewell Personal Care
The dividend yield is a little bit low, but sustainability of the payments is also an important part of evaluating an income stock. Before making this announcement, Edgewell Personal Care was easily earning enough to cover the dividend. This means that most of its earnings are being retained to grow the business.
The next year is set to see EPS grow by 53.5%. Assuming the dividend continues along recent trends, we think the payout ratio could be 15% by next year, which is in a pretty sustainable range.
The company's dividend history has been marked by instability, with at least one cut in the last 10 years. Since 2013, the dividend has gone from $1.60 total annually to $0.60. This works out to be a decline of approximately 9.3% per year over that time. Declining dividends isn't generally what we look for as they can indicate that the company is running into some challenges.
With a relatively unstable dividend, and a poor history of shrinking dividends, it's even more important to see if EPS is growing. It's encouraging to see that Edgewell Personal Care has been growing its earnings per share at 38% a year over the past five years. Rapid earnings growth and a low payout ratio suggest this company has been effectively reinvesting in its business. Should that continue, this company could have a bright future.
Overall, we think that this is a great income investment, and we think that maintaining the dividend this year may have been a conservative choice. The company is easily earning enough to cover its dividend payments and it is great to see that these earnings are being translated into cash flow. All of these factors considered, we think this has solid potential as a dividend stock.
Market movements attest to how highly valued a consistent dividend policy is compared to one which is more unpredictable. However, there are other things to consider for investors when analysing stock performance. To that end, Edgewell Personal Care has 2 warning signs (and 1 which is a bit unpleasant) we think you should know about. Looking for more high-yielding dividend ideas? Try our collection of strong dividend payers.
What are the risks and opportunities for Edgewell Personal Care?
Edgewell Personal Care
Edgewell Personal Care Company, together with its subsidiaries, manufactures and markets personal care products worldwide.Show more
Trading at 5.3% below our estimate of its fair value
Earnings are forecast to grow 13.44% per year
Earnings grew by 7.4% over the past year
Debt is not well covered by operating cash flow
Significant insider selling over the past 3 months
Further research onEdgewell Personal Care
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Edgewell Personal Care Company, together with its subsidiaries, manufactures and markets personal care products worldwide.
Undervalued with proven track record.Edgewell Personal Care Company2 warning signscollection of strong dividend payers.Have feedback on this article? Concerned about the content?Get in touch with us directly.We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice.