Starbucks Corporation (NASDAQ:SBUX) is drawing investor attention as its ex-dividend date, set for November 9th, looms just four days away. Investors are scrambling to acquire shares in the company in order to qualify for the upcoming dividend of $0.57 per share, which is scheduled for distribution on November 24th.
The dividend-focused investors are particularly keen due to trade settlement times. Owning shares before the ex-dividend date ensures eligibility for the imminent dividend payout. Given Starbucks' current stock price of $102.65 and its total distribution of $2.28 per share over the past year, this results in a trailing yield of around 2.2%.
The sustainability of Starbucks' dividend is confirmed by its payout ratio, which was 60% of its earnings last year, consuming 66% of its free cash flow. These figures fall within standard parameters for companies that distribute dividends, thus boosting Starbucks' appeal to dividend-focused investors.
Despite a modest annual earnings per share growth rate of 2.0% over the past five years, Starbucks has demonstrated a strong commitment to rewarding shareholders. This commitment is reflected in the company's impressive annual dividend growth rate of 18% over the past decade, suggesting a consistent return for investors despite limited future growth prospects.
While the majority payout of earnings hints at constrained future growth, it also underscores Starbucks' dedication to its shareholders. As such, with the ex-dividend date approaching rapidly, prospective and current investors are closely watching this retail giant's moves in anticipation of their potential gains.
InvestingPro Insights
Starbucks Corporation is not only an attractive option for dividend-focused investors but also offers a robust financial profile. According to InvestingPro data, Starbucks has a substantial market cap of $117.29 billion, indicating its significant presence in the market. The company's P/E ratio stands at 28.78, which, while higher than the industry average, is justified by the company's consistent performance and growth prospects.
InvestingPro Tips provide further insight into Starbucks' financial health. The company has a perfect Piotroski Score of 9, suggesting that its financial condition is strong. Another noteworthy point is the company's accelerating revenue growth, which is a positive sign for potential investors. Moreover, Starbucks has maintained its dividend payments for 14 consecutive years, reinforcing its appeal to dividend-focused investors.
For those interested in more comprehensive insights, InvestingPro offers a plethora of additional tips and data metrics. These include the company's return on assets, analyst predictions, and more, all of which can provide a more nuanced understanding of the company's financial standing and future prospects.
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