News Business Gentex Corp's Dividend Analysis: A Closer Look at Financial Health and Sustainability

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Gentex Corp's Dividend Analysis

Published on April 3, 2024

Assessing the Upcoming Dividend and Financial Health

Gentex Corp (NASDAQ: GNTX) recently declared a dividend of $0.12 per share, scheduled for payment on April 17, 2024, with the ex-dividend date set for April 4, 2024. As investors eagerly await this impending payout, let's delve into Gentex Corp's dividend history, yield, and growth rates.

What Does Gentex Corp Do?

Gentex, founded in 1974, initially specialized in smoke-detection equipment. Over the years, it evolved to become a leading supplier of digital vision, connected car, dimmable glass, and fire protection technologies. Automotive revenue constitutes approximately 98% of its total revenue. The company's commitment to innovation keeps it at the forefront of technology applications.

A Glimpse at Gentex Corp's Dividend History

Since 2003, Gentex Corp has consistently maintained dividend payments. Currently distributed quarterly, dividends reflect the company's stability and commitment to shareholders.

Breaking Down Dividend Yield and Growth

As of today:

  • 12-month trailing dividend yield: 1.34%
  • 12-month forward dividend yield: 1.34%

These figures suggest an expectation of consistent dividend payments over the next year. Over the past decade:

  • Annual dividend growth rate (3-year): 0.30%
  • Annual dividend growth rate (5-year): 6.70%
  • Annual dividends per share growth rate: 6.50%

Considering these metrics, the 5-year yield on cost of Gentex Corp stock is approximately 1.85%.

The Sustainability Question: Payout Ratio and Profitability

To assess dividend sustainability:

  • Dividend payout ratio (as of December 31, 2023): 0.27
  • Profitability rank (as of December 31, 2023): 9 out of 10

A lower payout ratio indicates retained earnings for future growth and resilience during downturns. Gentex Corp's strong profitability bodes well for ongoing dividend distributions.

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