This article first appeared on GuruFocus .
Evaluating the Sustainability of Keyera Corp's Next Dividend Payment
Keyera Corp ( KEYUF ) recently announced a total dividend of $0.40 per share, with the ex-dividend date set for Sept. 15, 2026. This distribution includes a cash dividend of $0.40 per share, payable on Sept. 29, 2026. As investors look forward to this upcoming payment, the spotlight also shines on the company's dividend history, yield and growth rates. Using data from GuruFocus, let's look into Keyera Corp's dividend performance and assess its sustainability.
What Does Keyera Corp Do?
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Keyera Corp is a midstream energy business that operates out of Alberta. Its primary lines of business consist of the gathering and processing of natural gas in western Canada, the storage, transportation and liquids blending for natural gas liquids and crude oil, and the marketing of natural gas liquids, iso-octane and crude oil. The company operates in three reportable segments: Gathering and Processing, Liquids Infrastructure and Marketing, where Liquids Infrastructure is the key revenue segment.
A Glimpse at Keyera Corp's Dividend History
Keyera Corp has maintained a consistent dividend payment record since 2010. Dividends are currently distributed on a quarterly basis. This long-standing commitment to returning capital to shareholders is a hallmark of the company's investment thesis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Keyera Corp's Dividend Yield and Growth
As of today, Keyera Corp currently has a 12-month trailing dividend yield of 3.90% and a 12-month forward dividend yield of 4.03%. This suggests an expectation of increased dividend payments over the next 12 months.
Over the past three years, Keyera Corp's annual dividend growth rate was 3.40%. Extended to a five-year horizon, this rate decreased to 2.80% per year. Over the past decade, Keyera Corp's annual dividends per share growth rate stands at 3.50%. Based on Keyera Corp's dividend yield and five-year growth rate, the 5-year yield on cost of Keyera Corp stock as of today is approximately 4.48%.
The Sustainability Question: Payout Ratio and Profitability
To assess the sustainability of the dividend, one needs to evaluate the company's payout ratio. The dividend payout ratio provides insights into the portion of earnings the company distributes as dividends. A lower ratio suggests that the company retains a significant part of its earnings, thereby ensuring the availability of funds for future growth and unexpected downturns. As of June 30, 2026, Keyera Corp's dividend payout ratio is 1.42. This may suggest that the company's dividend may not be sustainable.
Keyera Corp's profitability rank offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Keyera Corp's profitability 8 out of 10 as of June 30, 2026, suggesting good profitability prospects. The company has reported positive net income for each year over the past decade, further solidifying its high profitability.
Growth Metrics: The Future Outlook
To ensure the sustainability of dividends, a company must have robust growth metrics. Keyera Corp's growth rank of 8 out of 10 suggests that the company's growth trajectory is good relative to its competitors.
Revenue is the lifeblood of any company, and Keyera Corp's revenue per share , combined with the 3-year revenue growth rate , indicates a strong revenue model. Keyera Corp's revenue has increased by approximately -2.10% per year on average, a rate that outperforms approximately 51.33% of global competitors.
The company's 3-year EPS growth rate showcases its capability to grow its earnings, a critical component for sustaining dividends in the long run. During the past three years, Keyera Corp's earnings increased by approximately -3.70% per year on average, a rate that outperforms approximately 47.82% of global competitors. Lastly, the company's 5-year EBITDA growth rate of 3.90% outperforms approximately 30.27% of global competitors.
Next Steps for Dividend Investors
Keyera Corp's upcoming dividend payment of $0.40 per share reflects a consistent capital return policy dating back to 2010, but the payout ratio of 1.42 raises a red flag about near-term sustainability. While the company's profitability rank of 8 out of 10 and positive net income over the past decade are encouraging, the negative three-year revenue and EPS growth rates suggest underlying headwinds. Value investors should weigh the attractive forward yield of 4.03% against these growth challenges and monitor whether management can restore earnings coverage for the distribution. Will Keyera Corp's midstream infrastructure assets provide enough stability to bridge this gap?
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