Pick ‘n Pay Stores Ltd. : PKPYY-US: Dividend Analysis : June 09th, 2017 (record date) : By the numbers : June 8, 2017

Our analysis is based on comparing Pick ‘n Pay Stores Ltd. with the following peers – Whole Foods Market, Inc., Kroger Co., Wal-Mart Stores, Inc., Shoprite Holdings Limited Sponsored ADR and Kesko Oyj Unsponsored ADR Class B (WFM-US, KR-US, WMT-US, SRGHY-US and KKOYY-US).

Pick ‘n Pay Stores Ltd.’s dividend yield is 1.74 percent and its dividend payout is 44.80 percent. This compares to a peer median dividend yield of 1.68 percent and a payout level of 44.23 percent. This type of dividend performance might make it a good stock for dividend investors. However, the company’s average dividend quality score of 50 out of a possible score of 100, points to some weakness in the sustainability of its robust payout ratio, and makes its less attractive for dividend investors seeking current income.

Dividend Yield
Dividend Quality Score

Dividend Quality Overview

  • Dividend quality trend has not been consistent over the last five years. Dividends were paid during each of these years — of these 3 were high quality, 1 was medium quality and 1 was low quality.
  • The ending cash balance, with a dividend coverage of 1.37x, provides a moderate cushion in case of a significant reduction of cash flows in the future.
Dividend Quality Score Vs Dividend Yield

Quadrant label definitions. Hover to know more

High Score;High Yield, High Score;Low Yield, Low Score;Low Yield, Low Score;High Yield

Dividend Coverage

Over the last twelve months (prior to February 28, 2017), PKPYY-US paid a medium quality dividend.

The source of the company’s cash to support the dividend paid over the last twelve months is operating cash flow (coverage of 2.10x), investing cash flow (coverage of -2.39x), issuance cash flow (coverage of 1.28x) and twelve-month prior cash (coverage of 1.17x), for a total dividend coverage of 2.37x.

PKPYY-US‘s issuance cash flow includes outflows from net share buybacks (coverage of -0.45x). Thus, the total coverage including share buybacks is 2.82x, which reflects our assumption that the cash paid for share buybacks is discretionary and could instead be used to pay dividends.

Dividend Coverage by Cash Flow (TTM)

These coverage ratio factors imply that the firm’s net cash inflow from issuance was required (in addition to operating and investment cash) to pay the dividend, which suggests a medium dividend quality.

Dividend History

Item 2013-02-28 2014-02-28 2015-02-28 2016-02-29 2017-02-28 Latest
Dividend Yield (%) 2.89 1.96 1.94 2.56 2.11 1.74
Dividend Payout (%) 105.98 68.25 54 56.19 60.87 60

A complete list of metrics and analysis is available on the company page.

Company Profile

Pick n Pay Stores Ltd. is an investment holding company, which engages in the trading of retail food, clothing, general merchandise, pharmaceuticals, and liquor. The firm also acquires and develops strategic retail and distribution sites. It operates its business through the South Africa and Rest of Africa segments. The South Africa segment operates in various formats under the Pick n Pay and Boxer brands. The Rest of Africa segment is responsible for the company’s expansion into the other part of Africa. The company was founded by Raymond David Ackerman in 1967 and is headquartered in Cape Town, South Africa.


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