Is NYSE:SQM suited for dividend investing?

Last update: Oct 4, 2023

Take a closer look at QUIMICA Y MINERA CHIL-SP ADR (NYSE:SQM), a stock of interest to dividend investors uncovered by our stock screener. NYSE:SQM excels in fundamentals and provides a decent dividend, all while maintaining a reasonable valuation. Let's break it down further.

Dividend Analysis for NYSE:SQM

ChartMill assigns a proprietary Dividend Rating to each stock. The score is computed by evaluating various valuation aspects, like the yield, the history, the dividend growth and sustainability. NYSE:SQM was assigned a score of 8 for dividend:

With a Yearly Dividend Yield of 10.90%, SQM is a good candidate for dividend investing.
SQM's Dividend Yield is rather good when compared to the industry average which is at 2.04. SQM pays more dividend than 100.00% of the companies in the same industry.
SQM's Dividend Yield is rather good when compared to the S&P500 average which is at 2.68.
The dividend of SQM is nicely growing with an annual growth rate of 98.58%!
SQM has been paying a dividend for at least 10 years, so it has a reliable track record.
SQM's earnings are growing more than its dividend. This makes the dividend growth sustainable.

Health Analysis for NYSE:SQM

ChartMill assigns a Health Rating to every stock. This score ranges from 0 to 10 and evaluates the different health aspects like liquidity and solvency, both absolutely, but also relative to the industry peers. NYSE:SQM scores a 8 out of 10:

SQM has an Altman-Z score of 5.17. This indicates that SQM is financially healthy and has little risk of bankruptcy at the moment.
SQM has a better Altman-Z score (5.17) than 81.61% of its industry peers.
The Debt to FCF ratio of SQM is 2.06, which is a good value as it means it would take SQM, 2.06 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of SQM (2.06) is better than 90.80% of its industry peers.
SQM has a Debt/Equity ratio of 0.45. This is a healthy value indicating a solid balance between debt and equity.
Even though the debt/equity ratio score it not favorable for SQM, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
SQM has a Current Ratio of 2.48. This indicates that SQM is financially healthy and has no problem in meeting its short term obligations.
SQM's Current ratio of 2.48 is fine compared to the rest of the industry. SQM outperforms 60.92% of its industry peers.
With a decent Quick ratio value of 1.81, SQM is doing good in the industry, outperforming 68.97% of the companies in the same industry.

Profitability Analysis for NYSE:SQM

ChartMill employs its own Profitability Rating system for stock evaluation. This score, ranging from 0 to 10, is derived from an analysis of diverse profitability metrics and margins. In the case of NYSE:SQM, the assigned 10 is noteworthy for profitability:

SQM has a Return On Assets of 34.56%. This is amongst the best in the industry. SQM outperforms 100.00% of its industry peers.
With an excellent Return On Equity value of 71.10%, SQM belongs to the best of the industry, outperforming 100.00% of the companies in the same industry.
The Return On Invested Capital of SQM (46.56%) is better than 100.00% of its industry peers.
SQM had an Average Return On Invested Capital over the past 3 years of 22.85%. This is significantly above the industry average of 11.32%.
The 3 year average ROIC (22.85%) for SQM is below the current ROIC(46.56%), indicating increased profibility in the last year.
The Profit Margin of SQM (35.24%) is better than 97.70% of its industry peers.
In the last couple of years the Profit Margin of SQM has grown nicely.
Looking at the Operating Margin, with a value of 49.99%, SQM belongs to the top of the industry, outperforming 100.00% of the companies in the same industry.
In the last couple of years the Operating Margin of SQM has grown nicely.
SQM's Gross Margin of 51.46% is amongst the best of the industry. SQM outperforms 100.00% of its industry peers.
In the last couple of years the Gross Margin of SQM has grown nicely.

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For an up to date full fundamental analysis you can check the fundamental report of SQM

Keep in mind

Important Note: The content of this article is not intended as trading advice. It is essential to perform your own analysis and exercise caution when making trading decisions. The article presents observations created by automated analysis but does not guarantee any trading or investment outcomes. Always trade responsibly and make independent judgments.