Genuine Parts Company (GPC) has one of the best dividend track records in public equity market history, with the company paying dividends every year since going public in 1948.
But the best part is that GPC’s legacy isn’t over.
Wall Street analysts expects for GPC to see steady sales growth and dividend increases over the next several years.
This article will provide you with a full analysis on GPC’s dividend, along with key dates and dividend history.
That way, you can see if GPC would be a good dividend stock to buy.
How does Genuine Parts Co make money?
Genuine Parts Company distributes automotive and industrial replacement parts in North America and internationally.
You might have been to a GPC-owned stores, because GPC owns and operates the NAPA Auto Parts brand, which has over 6,000 locations in the US.
GPC’s Automotive Parts Group makes up just over 60% of GPC’s revenue. It supplies replacement parts for various vehicles and sells them to repair shops, fleet operators, and individual consumers.
GPC’s Industrial Parts Group offers various industrial replacement parts and supplies for different industrial operations.
The United States contributes the lion’s share of GPC’s revenue, with about 2/3 of the company’s sales. The other 1/3 of sales comes from Europe, Australasia, Canada, and a tiny amount of sales in Mexico.
The company’s broad sales channels and product range have helped GPC to drive consistent cash flows for investors.
Shareholder Insights:
What is Genuine Parts’s dividend yield?
GPC’s dividend yield is 2.8%, which means investors would receive $28 in yearly dividends for every $1,000 invested in the stock.
You can find a stock’s dividend yield by dividing the company’s annual dividend by its share price. GPC’s LTM dividend is $3.90, and its current share price is around $138.
If we divide the company’s $3.90 dividend by its $138 share price, it works out to a dividend yield of 2.8%.
GPC’s current dividend yield of 2.8% is slightly higher than its 10-year historical average and much higher than its 5-year average:
It’s generally better to buy a stock when its dividend yield is higher than its historical average because a company’s dividend yield rises when its share price falls.
Therefore, buying high-quality dividend stocks when the dividend yield is historically high can be an effective investing strategy.
Genuine Parts Co’s current dividend yield of 2.8% is a little bit better than some of its historical dividend yields:
- 1-year average historical dividend yield of 2.6%
- 3-year average historical dividend yield of 2.4%
- 5-year average historical dividend yield of 2.7%
- 10-year average historical dividend yield of 2.7%
What are GPC’s shareholder returns?
GPC has seen a 43.0% price return over the past five years, as the stock has grown from roughly $98 to roughly $140 today.
This means the stock has grown at a fair 7.4% compound annual growth rate (CAGR) over the past 5 years:
Although price return is helpful, a stock’s Total Shareholder Return is a more accurate way to see the real returns shareholders made by holding a stock.
The Total Shareholder Return measures the return shareholders make from the change in stock price as well as the return from the dividend, and it follows this formula:
Total Shareholder Returns = (Ending Stock Price + Dividends) / Initial Stock Price
Over the past 5 fiscal years, GPC has paid shareholders a total of $16.85 in dividends per share:
That means that investors have made a total shareholder return of 60.1% from holding GPC stock for the past 5 years, or a 9.9% compound annual return.
We love to see companies like GPC delivering over 9% total shareholder returns because that means the stock has delivered an above-market return.
What is GPC’s dividend growth rate?
Genuine Parts Company has grown its dividend payments at a compound annual growth rate (CAGR) of:
- 6.1% for the past fiscal year
- 6.3% over the past 3 years
- 5.7% over the past 5 years
- 5.9% over the past 10 years
GPC has consistently increased its dividend payments to shareholders for the past decade.
Investors love dividend growth because it means shareholders receive more money in dividends on the shares they already own.
It’s a lot like getting a raise at work!
Analysts expect GPC’s dividend increases are going to keep on coming.
Here are the consensus dividend growth analyst estimates:
- 5.0% CAGR for the next fiscal year
- 5.6% CAGR for the next 3 years
- 6.5% CAGR for the next 5 years
GPC has grown dividends at a 5.7% CAGR over the last 5 years, and analysts expect dividends to grow at 6.5% CAGR for the next 5 years.
GPC has strong dividend growth, especially when considered with the company’s overall dividend track record.
How long has GPC been paying dividends?
Genuine Parts Company has been paying dividends since going public in 1948, which is 76 years. GPC has one of the longest dividend track records in the history of public equity markets.
GPC has increased its dividends to shareholders for 68 consecutive years, making GPC a Dividend King. Companies reach Dividend King status when they’ve increased dividend payments to shareholders for over 50 straight years.
The graph below shows GPC’s dividend payments made to shareholders over the past 2 decades:
When does GPC pay dividends?
Genuine Parts Company has not released its next ex-dividend date or dividend payment date. However, in the third quarter two years ago, the company’s ex-dividend date was on September 1st, and the company’s dividend payment date was on October 3rd.
Therefore, GPC’s ex-dividend date for the third quarter will likely be in early September, and its next dividend payment date will likely be in early October.
However, you should only consider investing in Coca-Cola if you feel confident that the stock has the proper financial safety to be a good investment.
Is GPC’s dividend safe?
Generally, companies reduce or stop paying dividends if they lack the financial means to continue paying dividends.
So, it’s important to judge a company’s financial health.
GPC’s payout ratio is currently 44.4%, indicating that about 44% of the company’s $8.68 in earnings-per-share in the last 12 months were distributed as the company’s $3.90 annual dividend.
Generally, a high payout ratio above 80% indicates that a company is more likely to reduce its dividend.
In contrast, a low payout ratio like GPC’s suggests that the dividend is safer and can grow in the future.
Genuine Parts Company has a low payout ratio of under 50%, so it’s unlikely GPC will cut its dividend in the near future. Additionally, with the company’s 68-year track record of growing dividends, $GPC will likely continue paying dividends to shareholders for years to come.
Analysts expect GPC to grow its dividends at a 6.5% CAGR for the next 5 years. GPC can comfortably afford to do this with its low payout ratio.
Check out GPC’s Analyst Estimates >>>
Final Thoughts:
GPC has one of the most impressive dividend track records in the world.
And it makes a strong case for dividend investors to consider:
- It’s a Dividend King
- It has a low payout ratio (safety & growth potential)
- Analysts expect steady dividend growth going forward
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GPC Dividend FAQs:
How much is GPC’s dividend yield?
Genuine Parts Company’s current annual dividend is $3.90 per share, and GPC currently has a 2.8% dividend yield. This means that for each share of GPC stock you own, you will receive $3.90 in dividends annually.
Does Genuine Parts Company have strong earnings to cover its dividends?
GPC’s earnings are sufficient to cover its dividends because its payout ratio for the last twelve months has been 44.4%. The payout ratio measures the proportion of earnings paid out as dividends. Since GPC’s payout ratio is below 80%, it indicates that the company is earning enough to cover its dividend payments.
When is Genuine Parts Company’s next ex-dividend date?
Unfortunately, GPC has not released its next ex-dividend date, but in the third quarter two years ago, it was September 1st. Therefore, GPC’s next ex-dividend date will likely be in early September 2024.
When is Genuine Parts Company’s next dividend payment date?
Unfortunately, GPC has not released its next dividend payment date, but in the third quarter of last year, it was October 3rd. GPC’s next dividend payment date will likely be in early October 2024.
Is GPC a good dividend stock to buy?
GPC delivered a strong 9.9% compound annual total shareholder return over the past 5 years, and GPC still looks like a good dividend stock. GPC’s dividend looks safe from cuts, with a low 44.4% payout ratio. Additionally, GPC has an incredible dividend track record, with 68 consecutive years of dividend increases. Analysts expect the dividend to stay strong, with analysts forecasting the dividend to grow at a 6.5% CAGR over the next 5 years. It’s important for investors to do their own research and consider their individual circumstances when deciding whether GPC is a good dividend stock to buy.
Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. We aim to provide informative and engaging analysis to help empower individuals to make their own investment decisions. Neither TIKR nor our authors hold positions in any of the stocks mentioned in this article. Thank you for reading, and happy investing!
