Cardinal Health (CAH) is often referred to as a "Dividend Prince" due to several reasons:
-
Consistent Dividend Growth: The company has a history of increasing its dividends for 28 consecutive years1. This demonstrates a strong financial stability and commitment to returning value to shareholders.
-
Attractive Dividend Yield: The dividend yield for CAH is currently at 1.92% as of June 18, 20242, and has been as high as 2.04%1. This yield is competitive and attractive, especially in comparison to the average industry yield of 0%3.
-
Stable Dividend Payments: Cardinal Health has maintained a stable dividend payment for several years, with only minor fluctuations in the amount per share4. This stability is a sign of the company's ability to manage its cash flow and sustain its dividend program.
-
Sustainable Dividend Payout: The company's payout ratio is relatively high at 91.12%1, which suggests that a large portion of earnings are being distributed to shareholders. However, the dividend is covered by earnings and a smaller portion of free cash flows, indicating that the company can still reinvest in its business while maintaining its dividend payments.
-
Long-Term Dividend History: The annual dividend has increased from $1.21 in 2014 to $2.02 in the most recent fiscal year, reflecting a growth rate of approximately 5.3% over the last decade5. This history of steady growth supports the notion of CAH being a "Dividend Prince."
-
Future Dividend Potential: The company's track record of paying dividends for a long time and the recent increase in the dividend payment to $0.5056 per share, with an attractive yield of 2.0%5, suggests that the company is confident in its ability to continue paying dividends and may have room for further growth.
In conclusion, Cardinal Health's consistent dividend growth, attractive yield, stable payments, sustainable payout, long-term history, and recent positive developments all contribute to its reputation as a "Dividend Prince."