Global Payments (NYSE:GPN) Inc. has declared a dividend of $0.25 per share with a yield of 0.9%, as announced Today. This move is supported by the company's consistent cash flow and earnings, with a significant reinvestment of profits back into the business.
Looking ahead, Global Payments is expected to see a substantial increase in earnings per share (EPS) with a projected growth of 146.2% in 2024. This growth would contribute to a sustainable payout ratio of 16%. The company's history of dividends shows an impressive climb from $0.04 to $1.00 since 2013, which translates to an annual growth rate of 38%.
Despite this positive outlook, there are concerns regarding the sustainability of future dividends due to the observed volatility in the company's dividend history, including at least one reduction over the past decade. Moreover, the company's EPS has seen a downward trend, declining by approximately 2.9% per annum over the last five years.
InvestingPro Insights
According to InvestingPro, Global Payments Inc. (GPN) has demonstrated high earnings quality, with free cash flow exceeding net income. This supports the company's ability to maintain its consistent dividend payments, an achievement it has managed for 23 consecutive years. Furthermore, the company is expected to see growth in its net income this year, which bodes well for future dividend payments.
InvestingPro data further reveals that as of Q3 2023, Global Payments Inc. had a market cap of $27.92 billion and a P/E ratio of 32.16. The company also demonstrated revenue growth of 6.25% over the last twelve months as of Q3 2023.
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