Ryman Hospitality Properties Enhances Quarterly Dividend 6.2% (RHP)
By: Ned Piplovic,
Ryman Hospitality Properties, Inc. (NYSE: RHP) has been raising its annual dividend at a double-digit-percentage growth rate over the past five years and has announced another 6.2% quarterly dividend boost for the next period.
The annualized dividend payout for 2018 amounts to a forward yield of 4.4% and is significantly higher than the average yields of the company’s industry peers. In addition to the rising dividend payout with an above-average yield, Ryman’s share price rose significantly as well. Combined with the dividend payouts, investors saw a total return of nearly 25% over the past 12 months.
The company will distribute its next dividend on April 16, 2018 to all its shareholders of record prior to the March 28, 2018 ex-dividend date.
Ryman Hospitality Properties, Inc. (NYSE:RHP)
Ryman Hospitality Properties, Inc. (NYSE: RHP) operates as a real estate investment trust (REIT) that specializes in group-oriented, destination hotel assets in urban and resort markets. The company’s current portfolio includes a network of four upscale, meetings-focused resorts with approximately 7,800 guest rooms. In addition to those four resorts, the REIT also owns other properties, including the Gaylord Springs Golf Links, the Wildhorse Saloon, the General Jackson Showboat, The Inn at Opryland and the Gaylord Rockies Resort and Convention Center, which is a joint venture investment scheduled to open in the fourth-quarter 2018. The REIT also owns and operates media and entertainment assets, including the Grand Ole Opry — the legendary weekly showcase of country music performers for more than 90 years.
The REIT paid quarterly dividends briefly for two years in 1998 and 1999 before pausing distribution. Regular dividend payments resumed with a single $6.84 per share payment in December 2012. As the share price was trading close to $40 at this time, the distribution yielded more than 17%. The following year, Ryman Hospitality Properties returned to paying quarterly dividends and has been paying rising dividends every year for the past five consecutive years.
RHP announced that its first quarterly payment for 2018 will boost the dividend to $0.85 per share from $0.80, which is equivalent to a 6.2% rise in the quarterly dividend amount. This new quarterly distribution amount converts to a $3.40 annualized payout and a 4.4% yield, which is less than 5% below the company’s 4.6% average yield over the past five years.
Despite being slightly lower than the five-year average because of the rising share price, the trust’s current yield is just about 120% higher than the 2% average yield of the entire Services sector and 180% above the 1.56% simple average yield of all companies in the Lodging market segment. Ryman’s current yield is, at present, the highest yield in the segment and more than twice the amount of all but one other company in the segment — Extended Stay America, Inc. (NYSE: STAY), which has a yield in excess of 4%
Since the company resumed regular quarterly dividend distributions in 2013, the total annual dividend amount has risen at an average rate of 17.8% per year. That growth rate compounded means that the annual payout has increased 127% over the past five years.
Ryman’s share price rose almost 10% during the first quarter of the trailing 12 months (TTM), but lost all those gains, and more, during the subsequent 90 days. By September 5, 2017, the share price was 8% lower than it was in the middle of March 2017. After bottoming out in early September, the share price gained more than 30% by the end of January 2018. During the first week of February 2018, the share price dropped almost 13% along with the rest of the market. However, the drop was only temporary.
RHP shares returned to their uptrend and erased all recent losses, reaching a new 52-week high of $78.91 on March 13, 2018. This high was almost 25% higher than one year earlier, 36% above the September 2017 low and more than 70% higher than five years ago at this time.
The combined effect of a rising dividend income and robust asset appreciation rewarded shareholders with a 24% total return over the past 12 months. Counting dividends, the company’s total return over the past three years was more 50% and shareholders have doubled their investment over the past five years.
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Ned Piplovic is the assistant editor of website content at Eagle Financial Publications. He graduated from Columbia University with a Bachelor’s degree in Economics and Philosophy. Prior to joining Eagle, Ned spent 15 years in corporate operations and financial management. Ned writes for www.DividendInvestor.com and www.StockInvestor.com.