AptarGroup (NYSE:ATR), Inc. is approaching its ex-dividend date, which is one day ahead of the record date – the deadline for shareholders to be eligible for dividends. Investors who purchase shares either on or after October 25, 2023, shall not be qualified for the payment of dividend, scheduled for November 16.
The upcoming dividend is set at US$0.41 per share, a part of last year's total of US$1.64 per share. This yield is approximately 1.3% based on the current share price of $125.73, according to InvestingPro Data. Over the past year, dividends have made up 40% of AptarGroup's profits and 62% of its free cash flow, figures that fall within typical ranges for firms that distribute dividends.
AptarGroup, with a market cap of $8.25 billion, has maintained a steady increase in its dividend at an average annual rate of 6.4% over the past decade, and even more impressively, they have raised their dividend for 31 consecutive years, according to InvestingPro Tips. This consistency shows a commitment to return capital to shareholders even amid stagnant profit growth.
The sustainability of dividends is a key factor that significantly influences long-term investment returns. In the case of AptarGroup, while their dividends appear to be sustainable, the lack of earnings growth might be a concern for some investors. However, the company is trading at a high earnings multiple and P/E ratio relative to near-term earnings growth, indicating a potential for future growth.
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