Dividend Growth Stock Overview: Bunge Limited

Bunge produces, sells and distributes a variety of agricultural
products around the world.
Photo: Freeimages.com/William Ray

About Bunge Limited

Bunge supplies vegetable, milled grain products, sugar and ethanol to customers worldwide. The company’s history traces back to 1818, when Johann Peter Gottlieb Bunge founded Bunge & Co. as an import/export trading firm in Amsterdam, The Netherlands. The company has expanded worldwide since then, with significant operations in Argentina and Brazil, and is currently a holding LLC registered in Bermuda. Bunge has its executive headquarters in White Plains, New York, in order to be near to the world’s financial markets in New York City, and employs over 33,000 people worldwide. Bunge began trading on the New York Stock Exchange in 2001.

Bunge has 5 reportable business segments. The Agribusiness segment is responsible for the purchase, storage, transport, processing and sale of agricultural products including soybeans, canola and sunflower seed, and wheat and corn. The segment sells to manufacturers of food products, animal feed products and the biodesiel industry; the segment generates roughly 70% of Bunge’s annual sales and nearly 90% of Bunge’s annual income.

The Edible Oil Products segment produces and sells vegetable oils, shortenings and margarines for the food processor and food service industries, along with retail outlets that sell directly to the consumer. Bunge sells its products under multiple brand names around the world including Soya and Primor in Brazil; Pro-Formance NT in the United States; Venusz, Kujawski and Masmix in Europe; Dalda in India; and Dou Wei Jia in China. This segment generates roughly 15% of Bunge’s sales and 5% of Bunge’s income annually.

The Milling Products segment produces and sells milled grain products (e.g., wheat flours, bakery mixes, rice) to food processors and service companies, and cereal and snack companies. This segment generates less than 10% of Bunge’s sales and income.

The Sugar and Bioenergy segment produces and sells sugar and ethanol, and surplus energy generated by the burning of sugarcane remains after the agricultural products are processed for sugar. This segment, which is centered in Brazil, sells sugar to the Brazilian and export markets and ethanol to the Brazilian domestic market. The segment also sells surplus electricity (roughly 130 MW annually) to the Brazilian market. Less than 10% of Bunge’s sales and income were generated by the Sugar and Bioenergy segment.

Finally, the Fertilizer segment produces and distributes a variety of fertilizer products for agricultural production in South America. This segment contributes less than 1% of Bunge’s sales and income.

The company trades under the ticker symbol BG.

Bunge Limited’s Dividend and Stock Split History

Bunge Limited Dividend History

Bunge Limited has compounded dividends at over 10% a year since beginning its record of year-over-year dividend growth in 2001.

Bunge Limited has grown its dividends since coming public in 2001. The company announces annual dividend increases in the middle of May, with the stock going ex-dividend in the middle of August. Most recently, Bunge increased its payout by 11.8% in August 2015 to an annualized rate of $1.52.

Bunge has a good record of dividend growth, with annual increases in the high single digits or low double digits. Since beginning its record of dividend growth in 2001, Bunge has compounded dividends at 10.68% a year. Over the last 5 and 10 years, Bunge’s average annual dividend growth rates are 10.35% and 9.90%, respectively.

Bunge has not split its stock since coming public in 2001.

Over the 5 years ending on December 31, 2015, Bunge Limited stock appreciated at an annualized rate of 2.30%, from a split-adjusted $60.46 to $67.74. This dramatically underperformed the 10.20% compounded return of the S&P 500 index over the same period.

Bunge Limited’s Direct Purchase and Dividend Reinvestment Plans

Bunge Limited does not have a direct purchase or dividend reinvestment plan. In order to invest in Bunge stock, you’ll need to purchase it through a broker. Most brokers will allow you to reinvest dividends without any fee. Ask your broker for more information on how to set this up if you are interested.

Helpful Links

Bunge Limited’s Investor Relations Website

Current quote and financial summary for Bunge Limited (finviz.com)

 

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