NDA.DE 76.6 (+1.46%)
DE0006766504Metals & MiningCopper

Last update on 2024-06-27

Aurubis (NDA.DE) - Dividend Analysis (Final Score: 5/8)

Comprehensive dividend analysis of Aurubis (NDA.DE), highlighting performance and stability using an 8-criteria scoring system. Final score: 5 out of 8.

Knowledge hint:
The dividend analysis assesses the performance and stability of Aurubis (NDA.DE) dividend policy using a 8-criteria scoring system.
Learn more...

Short Analysis - Dividend Score: 5

We're running Aurubis (NDA.DE) against the 8-criteria scoring system to evaluate the performance and stability of a company's dividend policy.

Criteria
Dividend Yield Higher than the Industry Average?
1
Average annual Growth Rate higher than 5% in the last 20 years?
1
Average annual Payout Ratio lower than 65% in the last 20 years?
1
Dividends Well Covered by Earnings?
1
Dividends Well Covered by Cash Flow?
1
Stable Dividends Since the Company Began Paying Dividends?
0
Dividends Paid for Over 25 Years?
0
Reliable Stock Repurchases Over the Past 20 Years?
0

Aurubis (NDA.DE) has been analyzed based on 8 criteria to assess the performance and stability of its dividend policy. Here's a summary: 1. **Dividend Yield:** Aurubis has a current dividend yield (2.4239%) higher than the industry average (2.24%), which is good for income investors. However, the yield has fluctuated significantly over the past 20 years. 2. **Dividend Growth Rate:** This criterion is important for showcasing a company's ability to consistently enhance shareholder value. Aurubis has not consistently met the growth rate expectations over the years. 3. **Payout Ratio:** Aurubis has an average payout ratio of approximately 48.13% over the last 20 years, below the desirable 65% threshold, indicating prudent earnings distribution, but showed significant fluctuations. 4. **Dividend Coverage by Earnings:** There is inconsistency in earnings compared to dividends paid, suggesting potential financial instability at times. 5. **Dividend Coverage by Cash Flow:** Recent years have shown negative ratios indicating potential sustainability issues for future dividends. 6. **Dividend Stability:** Aurubis' dividend payments have been unstable with periods of significant reduction, including zero payments in some years. 7. **Long-Term Dividend Payments:** Aurubis has paid dividends consistently for 22 years despite some interruptions, demonstrating a solid commitment to returning value to shareholders. 8. **Stock Repurchases:** The company has only focused on stock repurchases moderately, with repurchases occurring in five years out of the past 20.

Insights for Value Investors Seeking Stable Income

Aurubis (NDA.DE) shows a mixed performance regarding its dividend policy. While it has a higher-than-industry-average dividend yield and a reasonable payout ratio, it suffers from instability and inconsistency in dividend payments and coverage by earnings and cash flow. Income-seeking investors might find its higher yield attractive but should consider the potential risks of dividend volatility and unsustainable payouts. It's worth monitoring closely or exploring further before making a substantial investment.

For those who are interested in delving deeper into the specifics, the subsequent section provides a comprehensive exploration of the criteria.

Dividend Yield Higher than the Industry Average?

Dividend yield is a financial ratio that shows how much a company pays out in dividends each year relative to its stock price. It is important to consider because a higher yield may indicate a good income investment, while a lower yield might indicate reinvestment of earnings for growth.

Historical Dividend Yield of Aurubis (NDA.DE) in comparison to the industry average

Aurubis (NDA.DE) has a current dividend yield of 2.4239%, which is higher than the industry average of 2.24%. This is a positive trend for income-focused investors. Looking at the past 20 years, Aurubis' dividend yield has fluctuated significantly, peaking at 6.8421% in 2003 and hitting a low of 0% in 2004. In recent years, the yield has been relatively stable, but slightly lower than earlier peaks. In comparison, the industry average has generally trended downward, particularly since 2013. The more consistent and higher relative yield of Aurubis could suggest better dividend payments and more reliability compared to the industry, making it a potentially attractive stock for dividend investors.

Average annual Growth Rate higher than 5% in the last 20 years?

Explain the criterion for Aurubis (NDA.DE) and why it is important to consider

Dividend Growth Rate of Aurubis (NDA.DE)

The Dividend Growth Rate criterion is essential since it showcases a company's ability to consistently enhance shareholder value over a long period. Dividend growth above 5% over 20 years indicates sound financial management and growing profitability, fostering greater investor confidence and potentially leading to increased stock valuations.

Average annual Payout Ratio lower than 65% in the last 20 years?

The payout ratio represents the proportion of earnings a company pays its shareholders as dividends. Ideally, a payout ratio lower than 65% is desirable as it indicates the company is retaining enough of its profits for growth and operational needs.

Dividends Payout Ratio of Aurubis (NDA.DE)

The calculated average payout ratio for Aurubis (NDA.DE) over the last 20 years is approximately 48.13%, which is well below the 65% threshold. This is a positive indicator as it shows the company has generally been prudent in distributing its earnings, ensuring they retain enough capital for reinvestment and unexpected expenses. However, it's crucial to note the significant outliers in the data, particularly in 2003 (682.0567) and negative figures in some years (e.g., -141.8314 in 2009). The very high and negative payout ratios can distort the overall financial health portrayal. The trend positively reflects disciplined financial management but requires scrutiny of abnormal fluctuations to understand their contexts fully. Generally, a payout ratio below the 65% mark supports sustainable dividend practices.

Dividends Well Covered by Earnings?

Explain the criterion for Aurubis (NDA.DE): Dividends are well covered by the earnings, and why it is important to consider

Historical coverage of Dividends by Earnings of Aurubis (NDA.DE)

Earnings per Share (EPS) have exhibited a high level of variability over the years. For example, EPS grew from 0.0953 in 2003 to reach peaks like 16.3693 in 2022, only to fall sharply to 3.2281 in 2023. On the other side, the company's Dividend per Share has shown a more stable tend over time with values like 0.65 in 2003 staedy growing to 2.90 in 2018, although there have been fluctuations. Comparing the EPS to the Dividend per Share to calculate the dividend coverage rate yields some years with extremely low coverage ratios (e.g., 0.194 in 2006 and -0.394 in 2013), indicating earnings are insufficient to cover dividend obligations. This inconsistency reflects potential financial instability. However, recent years—such as 2018, 2022, and 2023—show coverage ratios of 0.449, 0.097, and 0.557, respectively, with the 2023 figure being an improvement suggesting a good trend. Investors may find such periods of improved dividend coverage appealing, but must also consider the systemic volatility in Aurubis' earnings as a critical risk factor.

Dividends Well Covered by Cash Flow?

Evaluating whether a company's dividends are well covered by cash flow is crucial because it indicates whether the company can sustain its dividend payments from its core operations. Free cash flow (FCF) represents the cash generated by a company after accounting for capital expenditures, which is available to pay dividends. A higher coverage ratio typically signifies a healthier dividend situation.

Historical coverage of Dividends by Cashflow of Aurubis (NDA.DE)

Evaluating 20 years of data for Aurubis (NDA.DE) reveals fluctuating coverage ratios for dividends by free cash flow. In 2018 and 2019, the coverage ratios were exceptionally high at 1.938 and 1.388, respectively, indicating strong cash flow to cover dividends. However, in 2022 and 2023, the ratios went negative (-1.346 and -1.504), implying the company is not generating sufficient free cash flow to cover its dividends. The overall trend is concerning, as the recent years show negative coverage, signaling potential sustainability issues for future dividends unless profitability improves.

Stable Dividends Since the Company Began Paying Dividends?

Stable dividends are critical for income-seeking investors as they offer predictable income and reduce uncertainty, which enables better financial planning.

Historical Dividends per Share of Aurubis (NDA.DE)

Aurubis (NDA.DE) has demonstrated a certain degree of instability in its dividend payments over the last 20 years. The dividend per share has multiple instances where it drastically reduced, especially zero payments in 2004, and reductions exceeding 50% in years like 2009. Despite these drops, the company has managed to recover with significantly higher dividends on other occasions, like in 2016 and 2021, showing resilience. However, this volatility might not fulfill the objectives of income-seeking investors who prioritize stability and predictability in payouts. This trend could be considered bad for those strictly seeking stable dividend income.

Dividends Paid for Over 25 Years?

Dividends paid for over 25 years indicate financial stability, consistent profitability, and a shareholder-friendly approach. This long-term payment history can make a company more attractive to dividend-focused investors.

Historical Dividends per Share of Aurubis (NDA.DE)

Aurubis (NDA.DE) has paid dividends consistently from 2001 to 2023, except for the year 2004. Overall, Aurubis has shown a strong commitment to returning value to shareholders with consistent and, in many cases, rising dividend payouts. The interruption in 2004 does raise questions, but the long history of payouts over 22 years, despite turbulent economic conditions, is a positive indicator. Specifically, the dividend per share increased significantly over time, e.g., from €0.75 in 2001 to €1.8 in 2023. This trend demonstrates the company’s ability to generate sufficient profits and maintain a solid financial footing, making Aurubis an attractive pick for dividend-focused investors. However, it's important to monitor the consistency further to see if Aurubis can extend this streak to the full 25 years and beyond.

Reliable Stock Repurchases Over the Past 20 Years?

Reliable stock repurchases indicate a company's commitment to returning value to its shareholders and can also be a sign of management's confidence in the company's future growth.

Historical Number of Shares of Aurubis (NDA.DE)

Analyzing Aurubis (NDA.DE) over the past 20 years, the number of shares has shown moderate fluctuations. Notably, there have only been five years where the company consistently repurchased its shares (2004, 2005, 2020, 2021, 2022). Given the average repurchase percentage of 1.3274 per year, which is relatively low, it is clear that stock repurchasing hasn't been a significant focus for Aurubis. For long-term investors, this trend may be a mild concern as it suggests that the company's strategy for returning capital to shareholders might not robustly include buybacks. Overall, this pattern is neither particularly good nor bad but indicates a certain degree of inconsistency in commitment to reducing share count to return value.


Obligatory risk notice

We would like to point out that the contents of this website are for general information purposes only and do not constitute recommendations for the purchase or sale of specific financial instruments, and therefore do not constitute investment advice. In particular, marketstorylabs.com and its creators cannot assess the extent to which information / recommendations made on the pages correspond to your investment objectives, your risk tolerance and your ability to bear losses. Therefore, if you make any investment decisions based on information on the site, you do so solely on your own responsibility and at your own risk. This in turn means that neither marketstorylabs.com nor its creators are liable for any losses incurred as a result of investment decisions based on the information on the marketstorylabs.com website or other media used.

If you accept cookies, we use them to improve and personalize your experience. Manage Cookies