FTAI Aviation (NASDAQ:FTAI) Has Affirmed Its Dividend Of $0.30

FTAI Aviation Ltd.'s (NASDAQ:FTAI) investors are due to receive a payment of $0.30 per share on 25th of November. Including this payment, the dividend yield on the stock will be 0.8%, which is a modest boost for shareholders' returns.

While the dividend yield is important for income investors, it is also important to consider any large share price moves, as this will generally outweigh any gains from distributions. Investors will be pleased to see that FTAI Aviation's stock price has increased by 50% in the last 3 months, which is good for shareholders and can also explain a decrease in the dividend yield.

View our latest analysis for FTAI Aviation

FTAI Aviation's Projections Indicate Future Payments May Be Unsustainable

Estimates Indicate FTAI Aviation's Could Struggle to Maintain Dividend Payments In The Future

FTAI Aviation's Future Dividends May Potentially Be At Risk

If it is predictable over a long period, even low dividend yields can be attractive. Despite not generating a profit, FTAI Aviation is still paying a dividend. It is also not generating any free cash flow, we definitely have concerns when it comes to the sustainability of the dividend.

Over the next year, EPS is forecast to grow rapidly. Assuming the dividend continues along recent trends, we could see the payout ratio reach 797%, which is on the unsustainable side.

FTAI Aviation's Dividend Has Lacked Consistency

Even in its relatively short history, the company has reduced the dividend at least once. This suggests that the dividend might not be the most reliable. Since 2015, the dividend has gone from $1.32 total annually to $1.20. Doing the maths, this is a decline of about 1.1% per year. Declining dividends isn't generally what we look for as they can indicate that the company is running into some challenges.

The Dividend's Growth Prospects Are Limited

Given that the dividend has been cut in the past, we need to check if earnings are growing and if that might lead to stronger dividends in the future. Unfortunately, FTAI Aviation's earnings per share has been essentially flat over the past five years, which means the dividend may not be increased each year. With EPS growth hard to come by and the company not turning a profit, we wouldn't be particularly optimistic about the growth prospects for FTAI Aviation's dividend in the future.

FTAI Aviation's Dividend Doesn't Look Sustainable

Overall, it's nice to see a consistent dividend payment, but we think that longer term, the current level of payment might be unsustainable. The payments are bit high to be considered sustainable, and the track record isn't the best. This company is not in the top tier of income providing stocks.

It's important to note that companies having a consistent dividend policy will generate greater investor confidence than those having an erratic one. At the same time, there are other factors our readers should be conscious of before pouring capital into a stock. As an example, we've identified 1 warning sign for FTAI Aviation that you should be aware of before investing. Looking for more high-yielding dividend ideas? Try our collection of strong dividend payers.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.