Carlyle Group Announces Dividend Amid Sustainability Concerns

The Carlyle Group announces a $0.35 per share dividend, payable on May 21, 2024, with an ex-dividend date of May 13, 2024. The company's dividend sustainability is questioned due to slowing growth rates and profitability challenges.

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Nitish Verma
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Carlyle Group Announces Dividend Amid Sustainability Concerns

Carlyle Group Announces Dividend Amid Sustainability Concerns

The Carlyle Group, dividend, analysis Inc (NASDAQ:CG) has announced a dividend of $0.35 per share, payable on May 21, 2024, with an ex-dividend date set for May 13, 2024. The announcement has sparked interest in the company's dividend history, yield, and growth rates, as well as concerns over the sustainability of future payouts.

Why this matters: The Carlyle Group's dividend sustainability concerns have broader implications for investors and the financial industry, as it may impact the attractiveness of the company's shares and influence investment decisions. Furthermore, the company's struggles with profitability and growth may be indicative of larger trends in the private equity and asset management sectors.

The Carlyle Group currently boasts a trailing dividend yield of 3.29% and a forward dividend yield of 3.29%, indicating stable expected dividend payments over the next 12 months. However, the company's annual dividend growth rate has slowed in recent years, from 11.20% over the past three years to just 0.60% per year over a five-year period. The research, ratings growth rate turned negative at -5.40% over the past decade.

Despite the company's strong revenue model, with $426.0 billion in total assets under management (AUM) and $307.4 billion in fee-earning AUM as of December 2023, its dividend payout ratio is currently 0.00. This indicates that The Carlyle Group retains all its earnings, raising questions about the sustainability of dividends. The company's profitability rank stands at 3 out of 10, suggesting challenges in maintaining payouts, especially given that the company reported net profit in only 8 out of the past 10 years.

The Carlyle Group's business is divided into three main segments: private equity (35% of fee-earning AUM and 63% of base management fees in 2023), global credit (50% of fee-earning AUM and 25% of base management fees), and investment solutions (15% of fee-earning AUM and 12% of base management fees). The company's 5-year yield on cost is approximately 3.39%, but its 3-year revenue growth rate is a concerning -11.20% annually.

Considering The Carlyle Group's dividend payments, growth rate, payout ratio, profitability, and growth metrics, investors should maintain a cautious outlook regarding the sustainability of future dividends. The company's growth rank is also 3 out of 10, indicating poor growth prospects which may impact dividend sustainability. While the current yield may be attractive, the slowing growth and profitability challenges warrant careful monitoring by shareholders.

Key Takeaways

  • The Carlyle Group announces $0.35 dividend per share, payable on May 21, 2024.
  • Trailing dividend yield is 3.29%, but growth rate has slowed in recent years.
  • Dividend payout ratio is 0.00, raising sustainability concerns.
  • Company's profitability rank is 3 out of 10, indicating challenges in maintaining payouts.
  • Investors should be cautious about future dividend sustainability due to slowing growth and profitability challenges.