VSE Corp. : VSEC-US: Dividend Analysis : November 09th, 2016 (record date) : By the numbers : January 10, 2017

Our analysis is based on comparing VSE Corp. with the following peers – Kratos Defense & Security Solutions, Inc., Engility Holdings, Inc., KEYW Holding Corporation, Raytheon Company, Lockheed Martin Corporation, Northrop Grumman Corporation, General Dynamics Corporation, Aerojet Rocketdyne Holdings, Inc., Teledyne Technologies Incorporated and Orbital ATK, Inc. (KTOS-US, EGL-US, KEYW-US, RTN-US, LMT-US, NOC-US, GD-US, AJRD-US, TDY-US and OA-US).

VSE Corp.’s dividend yield is 0.59 percent and its dividend payout is 8.93 percent. This compares to a peer average dividend yield of 1.42 percent and a payout level of 26.89 percent. This relatively lagging dividend performance could spur some dividend action going forward – except the company’s current dividend quality score of 50 out of a possible score of 100 is only about average.

Dividend Yield
Dividend Quality Score

Dividend Quality Overview

  • Over the last twelve months (prior to September 30, 2016), VSEC-US paid a high quality dividend, which represents a yield of 0.58% at the current price.
  • Dividend quality trend has not been consistent over the last five years. Dividends were paid during each of these years — of these 2 were high quality, 1 was medium quality and 2 were low quality.
  • The ending cash balance is less than the last full year dividend payment and cannot be relied on to cushion any 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 September 30, 2016), VSEC-US paid a high 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 19.56x), investing cash flow (coverage of -4.90x), issuance cash flow (coverage of -13.52x) and twelve-month prior cash (coverage of 0.08x), for a total dividend coverage of 1.23x.

VSEC-US‘s issuance cash flow includes outflows from net debt repayment (coverage of -5.68x).

Dividend Coverage by Cash Flow (TTM)

These coverage ratio factors imply that the firm’s dividends are wholly paid from operating and investing cash flows net of any debt repayments, which suggests a high dividend quality.

Dividend History

Item 2011-12-31 2012-12-31 2013-12-31 2014-12-31 2015-12-31 Latest
Dividend Yield (%) 1.07 1.22 0.71 0.58 0.68 0.59
Dividend Payout (%) 6.62 7.48 7.94 10.53 9.09 8.93

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

Company Profile

VSE Corp. engages in the provision of technical services to the owners and operators of transportation and equipment assets and large, mission critical fleets. Its operations include supply chain management solutions and parts supply for vehicle fleets; maintenance, repair, and overhaul services and parts supply for aviation clients; vehicle equipment maintenance and refurbishment, logistics; engineering; energy and environmental services; Information Technology (IT) and health care IT solutions; and consulting services. It operates through the following segments: Supply Chain; Aviation; Federal Services; and IT, Energy, and Management Consulting. The Supply Chain segment provides sourcing, acquisition, scheduling, transportation, shipping, logistics, data management, and other services to assist its clients with supply chain management efforts. The Aviation segment provides MRO services, parts supply and distribution, and supply chain solutions for general aviation jet aircraft engines and engine accessories. The Federal Services segment provides foreign military sale services, refurbishment services, fleet-wide ship and aircraft support, aircraft sustainment and maintenance, and other related services. The IT, Energy, and Management Consulting segment provides technical and consulting services. The company was founded on January 22, 1959 and is headquartered in Alexandria, VA.

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