(281)-719-8904 KenFaulkenberry@AAAMP.com

Gap (GPS) Dividend Analyzer Analysis

by | Dividend Contenders, Dividend Stock Analysis

Gap Dividend

(updated 5/26/2017)

The Gap dividend has been paid continuously since 1995 and increased for 12 consecutive years; qualifying the company as a Dividend Contender.

Price: $22.43
Current Dividend: $0.92

Dividend Yield: 4.1%
Cash Dividend Payout Ratio: 32%

Market Capitalization: 8.9 B
Enterprise Value: 8.5 B

Description

Sector: Consumer Cyclical
Industry: Apparel Stores

Gap Inc is an apparel retail company. It offers apparel, accessories, and personal care products for men, women, children and babies under the Gap, Old Navy, Banana Republic, Athleta, and Intermix brands.

Dividend Analyzer Checklist

(updated February 2017)

Dividend Safety Score (24/33 points)

Dividend Per Share (ttm): $0.92
Dividend Payout Ratio (ttm): 55%
Dividend Per Share (10 Year Growth): 17.7%
Cash From Operations (CFO) Per Share (ttm): $4.15
CFO Dividend Coverage (CFO / DPS): 4.5 (5/6 points)
Free Cash Flow (FCF) Per Share (ttm): $2.64
FCF Dividend Coverage (FCF / DPS): 2.9 (5/6 points)
Net Financial Debt: $222 M
Total Assets: $8007 M
Net Financial Debt / Total Assets: 3% (10/12 points)
Net Financial Debt to EBITDA (ttm): 94%
Total Liabilities to Assets Ratio (Qtr.): 66%
Piotroski Score (1-9) (TTM): (4/9 points)

Profitability & Growth Score (22/33 points)

Revenue (10 Year Growth) *CAGR > 4.14%: -0.1% (0/4 points)
EPS Basic Cont. Operations (10 Year Growth) CAGR > 4.14%: 5.8% (4/4 points)
Cash From Operations (10 Year Growth) CAGR > 4.14%: 0.3 (0/6 points)
Operating Earnings Yield (ttm): 12.8 (7/7 points)
Net Income (ttm): $670
Gross Profit (ttm): $5579 M
Total Assets: $8007 M
Gross Profitability Ratio = GP / Total Assets: 70% (11/12 points)
Cash Return On Invested Capital (CROIC)(tttm): 24%
Return on Invested Capital (ROIC): 15%
Return on Invested Capital (ROIC) (5 Year Median): 26%
Return on Invested Capital (ROIC) (10 Year Median): 22%

Valuation Score (31/34 points)

Free Cash Flow Yield (ttm): 10.8 (9/9 points)
EV to EBIT (ttm): 7.9 (8/9 points)
EV to EBITDA (ttm): 5.4 (8/9 points)
PE10: 12.8 (6/7 points)
Price to Sales Ratio (ttm): 0.6
Price to Book Value (ttm): 3.5
Price to Earnings Ratio (P/E) (ttm): 14.2

TOTAL POINTS – (77/100) (50 is an average score)

*Compound Annual Growth Rate (CAGR)
**A Compound Annual Growth Rate of 4.14% = a 50% gain over 10 years.

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Conclusion

(Updated February 2017)

Gap (GPS) is ranked #9 (out of 257) overall and #4(out of 16) in the Consumer Cyclical Sector by the Dividend Analyzer.

Gap stock provides one of the best risk/reward opportunities in the dividend universe today.

Portfolio Position Disclosures:
DVB Foundation Portfolio: None
DVB Dividend Growth: Long
DVB High Income: None
Arbor Asset Allocation Model Portfolio (AAAMP): Long

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Disclaimer: While Arbor Investment Planner has used reasonable efforts to obtain information from reliable sources, we make no representations or warranties as to the accuracy, reliability, or completeness of third-party information presented herein. The sole purpose of this analysis is information. Nothing presented herein is, or is intended to constitute investment advice. Consult your financial advisor before making investment decisions.
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