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Starbucks has consistently paid dividends since 2010, with its first payout amounting to $0.05 per share. This sets a precedent for investors looking for a stable source of income.
The company's dividend yield is a key metric for investors, measuring the ratio of the annual dividend payment to the stock's current price. Starbucks' dividend yield has been around 2% in recent years.
One of the reasons Starbucks has been able to maintain a stable dividend yield is its strong cash flow generation. In 2020, the company generated $3.3 billion in operating cash flow.
Investors can use the dividend yield to gauge the attractiveness of Starbucks stock compared to other investments. A higher dividend yield can indicate a more attractive investment opportunity.
Dividend Yield and Shareholder Yield
Shareholder Yield is a metric that measures the total return to shareholders through dividends, buybacks, and debt paydown. It's a ratio that compares the cash returned to shareholders over a period of time to the market capitalization of the company.
Shareholder Yield is a valuable tool for investors to evaluate a company's financial health and potential for future growth. For example, Starbucks Corporation (SBUX) has a shareholder yield graph that includes indicators for dividends, buybacks, and debt paydown.
Dividend Yield is a key component of Shareholder Yield. Starbucks has a reasonable payout ratio of 69.9%, which means its dividend payments are covered by earnings. This is a good sign for investors looking for a reliable dividend income stream.
A high cash payout ratio can be a concern for investors, but Starbucks' current cash payout ratio of 83.4% is still manageable. This indicates that its dividend payments are covered by cash flows, providing a stable source of income for shareholders.
Financial Performance
Starbucks Corporation has a stable dividend history, with dividends per share remaining steady over the past 10 years.
The company's dividend payments have actually increased over the past decade, providing a growing income stream for investors.
With a compound average dividend growth rate of 9.3% over the last five years, Starbucks Corporation is a strong contender for dividend investors.
The company's current dividend yield is 2.6%, ranking it in the 28th percentile among all U.S.-listed dividend-paying stocks.
Here's a snapshot of Starbucks Corporation's dividend performance:
As you consider adding Starbucks Corporation to your portfolio, be sure to do your own research and due diligence to ensure it aligns with your investment goals.
Payment and Payout
Starbucks' dividend payments have been stable in the past 10 years, with a steady stream of income for shareholders.
The company's payout ratio is reasonable at 69.9%, which means its dividend payments are well-covered by earnings. This is a crucial factor to consider when evaluating dividend stocks.
Starbucks' dividend payments have increased over the past 10 years, providing a growing income stream for shareholders. This is a great sign for investors who value consistent dividend growth.
At its current cash payout ratio of 83.4%, Starbucks' dividend payments are covered by cash flows, providing a stable source of income for shareholders.
Market and Valuation
SBUX's dividend yield is higher than the bottom 25% of dividend payers in both the AR market (1.0%) and the US market (1.4%). This indicates that Starbucks' dividend is relatively attractive compared to its peers.
The market top 25% of dividend payers in both the AR market (4.5%) and the US market (4.5%) have a significantly higher dividend yield. This means that while Starbucks' dividend is notable, it's not among the highest in its market.
Here's a comparison of SBUX's dividend yield to the market:
The Dividend Valuation Score for Starbucks Corporation is 25, indicating a value grade of B. This suggests that Starbucks' stock is considered a value investment, with a relatively low valuation compared to its historical norm.
Data
Starbucks Corporation's dividend yield is 2.56%, which means investors would receive $2.56 in dividends per year for every $100 invested in the company's stock.
The company's payout ratio is 68.73%, indicating that 68.73% of its earnings are paid out as dividends.
A low payout ratio can be a sign of a strong financial position, allowing the company to invest in growth opportunities.
Starbucks Corporation pays dividends on a quarterly basis, with the next payment planned on February 28, 2025.
The ex-dividend date is February 14, 2025, meaning buyers purchasing shares on or after that date will not be eligible to receive the next dividend payment.
The annual dividend is $2.44 per share, which is the total amount paid out to shareholders in a year.
Starbucks Corporation has increased its dividends for 14 consecutive years, a positive sign of the company's financial stability and ability to pay consistent dividends in the future.
Market
The market can be a tough place to navigate, especially when it comes to dividend yields. In the US market, the bottom 25% of dividend payers have a yield of 1.4%. This means that if you're looking for a high dividend yield, you may want to consider companies outside of this range.
SBUX's dividend yield of 2.6% is actually higher than the bottom 25% of dividend payers in the US market, which is a notable advantage. However, it's still lower than the top 25% of dividend payers, which have a yield of 4.5%.
Here's a breakdown of the different segments of the market and their corresponding dividend yields:
As you can see, the market is diverse, and there are opportunities to be found in different segments. It's essential to do your research and understand the market before making any investment decisions.
Valuation
Stock prices tend to fluctuate between high and low valuation levels, and these relationships can be used to determine a stock's value range.
A key metric used in valuation is the relative dividend yield, which can be used to calculate a valuation estimate and indicate if a stock is expensive relative to its historical norm.
The Dividend Grader uses the relative dividend yield to assign a Dividend Valuation Score, which is the percentile rank of the average of the percentile ranks of the relative dividend yield and shareholder yield.
Stocks with a value score from 0 to 20 are considered deep value, while those with a score between 21 and 40 are considered value.
A Dividend Valuation Score of 25, as seen in Starbucks Corporation, translates into a Dividend Valuation Grade of B and is considered value.
To be assigned a Dividend Valuation Score, a stock must have valid and corresponding rankings for both relative dividend yield and shareholder yield.
Frequently Asked Questions
How much does Starbucks pay in dividends?
For every $100 invested in Starbucks stock, investors receive $2.64 in dividends per year. This translates to a dividend payout of 2.64% of the investment.
What is Starbucks current yield?
Starbucks' current dividend yield is 2.51% as of December. Check for the latest yield on our website for the most up-to-date information.
What is Starbucks average dividend yield?
Starbucks' average dividend yield is 2.58% as of December. Check the current dividend yield for SBUX for the most up-to-date information.
Sources
- https://www.koyfin.com/company/sbux/dividends/
- https://stockanalysis.com/stocks/sbux/dividend/
- https://simplywall.st/stocks/ar/consumer-services/base-sbux/starbucks-shares/dividend
- https://www.aaii.com/investingideas/article/18683-is-starbucks-corporation-sbux-a-good-dividend-stock
- https://simplywall.st/stocks/us/consumer-services/nasdaq-sbux/starbucks/dividend
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