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At the Money: Getting More Out of Dividends with Shareholder Yield. Meb Faber, Cambria Investments (October 30, 2024) Dividend investing has a long and storied history, but it turns out dividends are only part of the picture driving stock returns. How do you define what shareholder yield is?
This is thanks, in part, to Carnival's fantastic earnings performance, but another element may be even better news for shareholders. Carnival's wall of debt First, let's take a quick look back in time at the challenges Carnival faced in recent years. Carnival also has prepaid debt, for example prepaying $7.3
He also places a high value on companies that generate profits that can be reinvested in the business at high rates of return. Apple certainly passes the latter test, earning an extraordinary return on invested capital of 56%. Buffett admires Apple's ability to make products that people can't live without.
Trust in superior capital allocation Capital allocation in the oil space can be difficult because a company's survival is often prioritized over shareholder profits. How can we tell how good a company has done at investingshareholder wealth? Buffett likes companies that put shareholder interests first. of the company.
Some producers earn higher returns on their reinvested capital dollars than rivals. Here's a look at the return on invested capital ( ROIC ) among some of the largest integrated oil companies using data from New Constructs. Focusing on investing for returns The oil industry has shifted its mindset in recent years.
ITW Return on Invested Capital data by YCharts. The company has prudently acquired companies over the years (more than two dozen acquisitions), steadily increasing its return on invested capital (ROIC). While Illinois Tool Works leans on debt, it doesn't do so too heavily. TTM = trailing 12 months.
In fact, Microsoft and Nvidia have more cash and equivalents like marketable securities than long-term debt, hence the negative figures. NVDA net total long-term debt (quarterly) data by YCharts. Oil and gas is capital intensive, and so is investing in AI. Microsoft pays more dividends than any other U.S.-based
OTC Markets itself, though, could hardly be in better financial shape -- and its recent shareholderreturns speak to that fact. First, the company acquired Blue Sky Data and its state law compliance data on over 40,000 equity and debt securities for a mere $12 million.
We're pleased with our performance in the third quarter, which resulted in an annualized return on equity of 18.8%, DNII per share that continued to exceed the dividends paid to our shareholders, and a new record for NAV per share for the ninth consecutive quarter. per share.
The company's return on invested capital (ROIC), an important metric that measures operational efficiency, has been over 10% for nearly two decades. billion of long-term debt, Emerson's debt-to-equity ratio indicates an exceptionally healthy balance sheet, even if you exclude intangible assets associated with its previous acquisitions.
But the company strikes a balance between returning cash to shareholders and expanding geographically (it now has 6,217 stores) at a highly profitable rate, and after a recent dip, it is as good a time as any to buy shares of this seemingly unstoppable stock. ORLY return on invested capital; data by YCharts.
WM Cash from Operations (TTM) data by YCharts Despite this ramped-up capex spending, Waste Management remains FCF positive, returning $283 million in dividends and $370 million in stock buybacks to its shareholders during the third quarter. ROIC shows that it is the best in its industry at reinvesting in its business.
billion debt-reduction program.) While some investors may not like that, it reduces shares in issue and increases the claim of existing shareholders on future cash flow. Capital-allocation policy Devon Energy's capital allocation policy targets using 30% of FCF to support the balance sheet, partly in connection with the acquisition.
Return on invested capital also has been on the rise over the past year. AMZN Return on Invested Capital data by YCharts These moves should benefit the company in better times, too. Investors' biggest concern about Carnival has been the company's debt levels. Should you invest $1,000 in Amazon right now?
billion, acquired Magnum Development, and agreed to buy Hess in a giant $60 billion deal (including debt) that's expected to close early this year. The return on investment for Chevron's acquisitions won't be immediate, but its healthy dividend should give investors the patience to stick around for the long haul.
If you're a current shareholder or are looking to buy shares, you'll want to consider the following first. That's because borrowing costs on new or floating-rate debt go up, making it more expensive to fund acquisitions. and is on solid financial footing, with no debt maturing until 2028.
A stellar return on invested capital Leveraging the power of its leadership position in the pool supplies and pool-related products market, Pool Corp. Best yet for investors, Pool's strong profitability also allows it to reward shareholders through rising dividends in addition to this intriguing growth optionality.
Even with the company currently in the trough of its business cycle, Omega Flex currently holds a return on invested capital (ROIC) of 24%. Measuring the company's profitability compared to its debt and equity, this resilient ROIC is indicative of a wide moat surrounding Omega Flex's operations.
million, producing a core EBITDA margin of 11% and a trailing 12-month return on invested capital of 8.4%. As can be seen on Slide 19, for the first fiscal quarter of 2025, our net debt to adjusted EBITDA ratio now sits at just 0.6 While net debt to capitalization is only 6%. Thank you very much.
Three examples are businesses with consistently growing dividend payments and a low payout ratio, steady share repurchases, and a high and rising return on invested capital. Particular financial metrics have been proven to indicate market-beating potential when analyzing stocks. This is important to investors.
The business beat Wall Street estimates on both the top and bottom lines in the three-month period, which is certainly an encouraging sign for shareholders. 31, the company still carried almost $29 billion in long-term debt on its balance sheet. This is evidenced by the company's extremely low return on invested capital (ROIC).
Scraping together enough cash to invest in the stock market isn't easy. Between monthly bills and other living expenses, paying down high-interest credit card debt, and topping up your emergency savings, many things take precedence. A redesign of the company's U.S.
Airlines aren't productive (at least for shareholders) The ultimate test of whether a company is allocating capital productively for shareholders is the comparison between its return on invested capita l (ROIC) and its weighted average cost of capital (WACC). Here's the lowdown on a fascinating industry.
Best-in-class profitability Home to over 100 brands sold in 80 countries, Hershey has a proven track record of generating healthy returns on invested capital as it expanded across the United States in its younger years and globally more recently. return for the S&P 500 as a whole, equally weighted. compared to a 7.7%
It also expects to have a net-debt-to-adjusted- EBITDA ratio of 3.8, Kinder Morgan was levered up with debt, but it had previously been making a ton of money. For 2024, Kinder Morgan is forecasting that it will pay a dividend of $1.15 per share while collecting $1.21 in earnings per share and $8 billion in adjusted EBITDA.
This resulted in higher realized iron ore premiums, but more importantly, higher margins and returns on invested capital. Looking ahead, we will remain highly focused on our disciplined capital allocation approach, balancing capex optimization, accretive growth, and strong shareholderreturns. billion in the quarter.
Top-tier profitability Recording a return on invested capital (ROIC) of 13%, Diageo and its Jack Daniels-making peer, Brown-Forman , are the only spirits-focused companies that consistently generate value for shareholders when putting their debt and equity to use.
With our industry-leading brands that excel in each of their respective segments, the most innovative fleet and destinations, and the best people who are focused on delivering a lifetime of vacations for our guests, we focus on winning share from the large and attractive travel industry while delivering long-term shareholder value.
It doesn't have a great track record for investing its capital efficiently As an investor, it's important to know whether a business is going to make good use of the capital it has on hand, as well as the capital it can draw on in the form of debt and shareholders' equity.
Best-in-class profitability and incredible returns However, this leadership position means nothing if it doesn't lead to profits and free cash flow (FCF). With a return on invested capital (ROIC) of 28% and an expected $1 billion in FCF in 2023, Bombardier is also a leader on the profitability side of things.
Requiring a 15% annualized return for five years, an investment needs to slightly outperform the market's historical annualized total return of roughly 11% to 12% to accomplish this feat. United Parcel Service (NYSE: UPS) and Murphy USA (NYSE: MUSA) are two companies that fit this simple billing.
The logic behind the spinoff was that it would unlock shareholder value and allow each company to more easily pursue mergers and acquisitions (M&A), allocate capital, and compensate employees as a pure play focused on one industry. GXO Logistics (NYSE: GXO) just marked two full years as a publicly traded company.
This allowed FedEx to maintain a stable gross margin and return on invested capital (ROIC). FDX Return on Invested Capital data by YCharts. It's how shareholder value is created, and it speaks to the management team's capital stewardship. so it's not struggling to meet its debt obligations.
billion in debt and returned $1.6 billion in capital to shareholders due to dividend and share repurchases, lowering our leverage in line with our objectives and continuing our balanced capital allocation discipline. billion of debt in 2024 and coupled with earnings growth, lowered our debt-to-EBITDA leverage from 4.1
Lower interest rates lower the cost of capital and can increase the return on investment for capital-intensive projects. In the past nine years, it has reduced its total net long-term debt position by 29% and lowered its leverage. PBA Debt To Capital (Quarterly) data by YCharts. For context, Kinder Morgan spent $2.5
Shares of beauty retailer Ulta Beauty (NASDAQ: ULTA) have more than tripled the total return of the S&P 500 since their initial public offering in 2007, rising more than 1,300%. Ulta's market-beating qualities Ulta Beauty boasts a return on invested capital (ROIC) of 61%. Image Source: Getty Images. Home to 43.3
Apple's return on invested capital is currently an outstanding 54.1%. Yes, Apple carries term debt, to the tune of $97 billion. On the other hand, Apple has $157 billion in cash, cash equivalents, and marketable securities on the books, providing ample cushion and giving shareholders peace of mind.
However, one goal may be even more important than all of these : reducing debt. Carnival's debt load remains alarming While Carnival's revenue and operating income have exceeded pre-pandemic levels, the cruise company's stock is still 68% below its all-time high of $66 , reached in early 2018. billion in long-term debt.
A high-growth restaurant John Ballard (Chipotle Mexican Grill): Chipotle has been a stellar performer for shareholders over the last decade. The stock returned 450%, beating the major indexes, as the company grew revenue and earnings at double-digit percentages on an annualized basis.
Finally, I'll finish my remarks by narrowing in on specific actions we're taking in the near term to drive improved profitability and enhance shareholder value in 2025. The largest use of cash during the year was $87 million used to repurchase $111 million of debt in March. And we'll then open the line for Q&A.
Over the last decade, MTY has averaged a return on invested capital (ROIC) of 15%, generating high levels of FCF compared to the debt and equity it uses to fund its M&A ambitions. This $400 million outlay gives the company plenty of integration work to do as it focuses on paying down its $686 million net debt balance.
On the bottom line, Carnival continued to move in the right direction though the company is still facing stiff headwinds from its heavy debt burden, which jumped during the pandemic. The company is making progress on easing its debt burden as it prepaid more than $1 billion in short-term, variable-rate debt, though it still has about $7.5
So, to examine this, investors can look at what each company is generating as a return on invested capital (ROIC). LOW Return on Invested Capital data by YCharts A high ROIC is excellent, but what a company pays for its capital, called the weighted average cost of capital, or WAAC , is just as important.
Also, many of the companies in this industry are structured as master limited partnerships, which makes each shareholder responsible for their portion of the partnership's taxable income. What makes MPLX stand out among its peers is its strong rates of return, capital discipline, and generous returns to shareholders.
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