MTN Group Ltd's Dividend Analysis

In This Article:

Assessing the Sustainability of MTN Group Ltd's Upcoming Dividend

MTN Group Ltd (MTNOY) recently announced a dividend of $0.17 per share, payable on 2024-05-02, with the ex-dividend date set for 2024-04-18. As investors look forward to this upcoming payment, the spotlight also shines on the company's dividend history, yield, and growth rates. Using the data from GuruFocus, let's look into MTN Group Ltd's dividend performance and assess its sustainability.

What Does MTN Group Ltd Do?

MTN Group Ltd is a mobile telecommunications provider operating across South Africa, Nigeria, Ghana, Cameroon, Ivory Coast, Uganda, Syria, and Sudan. Most of the company's revenue is earned in South Africa and Nigeria. The company also has a joint venture in Iran. From a product perspective, most of its revenue is from voice and data. Other contributors include SMS and sale of devices revenue. MTN also provides enterprise services to small/midsize enterprises and corporate clients. The company owns the mobile infrastructure and data centers. Its segments include Network services, Mobile devices, Inter-connect and roaming, Digital and fintech and others.

MTN Group Ltd's Dividend Analysis
MTN Group Ltd's Dividend Analysis

A Glimpse at MTN Group Ltd's Dividend History

MTN Group Ltd has maintained a consistent dividend payment record since 2022. Dividends are currently distributed on a yearly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.

Breaking Down MTN Group Ltd's Dividend Yield and Growth

As of today, MTN Group Ltd currently has a 12-month trailing dividend yield of 3.98% and a 12-month forward dividend yield of 3.86%. This suggests an expectation of decreased dividend payments over the next 12 months. Over the past three years, MTN Group Ltd's annual dividend growth rate was -2.40%. Based on MTN Group Ltd's dividend yield and five-year growth rate, the 5-year yield on cost of MTN Group Ltd stock as of today is approximately 3.98%.

MTN Group Ltd's Dividend Analysis
MTN Group Ltd's Dividend Analysis

The Sustainability Question: Payout Ratio and Profitability

To assess the sustainability of the dividend, one needs to evaluate the company's payout ratio. The dividend payout ratio provides insights into the portion of earnings the company distributes as dividends. A lower ratio suggests that the company retains a significant part of its earnings, thereby ensuring the availability of funds for future growth and unexpected downturns. As of 2023-12-31, MTN Group Ltd's dividend payout ratio is 1.04, which may suggest that the company's dividend may not be sustainable. MTN Group Ltd's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks MTN Group Ltd's profitability 8 out of 10 as of 2023-12-31, suggesting good profitability prospects. The company has reported net profit in 9 years out of past 10 years.