In This Article:
Investors who want to cash in on Tiangong International Company Limited’s (SEHK:826) upcoming dividend of CN¥0.04 per share have only 2 days left to buy the shares before its ex-dividend date, 17 May 2018, in time for dividends payable on the 08 June 2018. Investors looking for higher income-generating stocks to add to their portfolio should keep reading, as I take a deeper dive into Tiangong International’s latest financial data to analyse its dividend attributes. View our latest analysis for Tiangong International
5 checks you should do on a dividend stock
Whenever I am looking at a potential dividend stock investment, I always check these five metrics:
-
Is their annual yield among the top 25% of dividend payers?
-
Has its dividend been stable over the past (i.e. no missed payments or significant payout cuts)?
-
Has dividend per share amount increased over the past?
-
Is its earnings sufficient to payout dividend at the current rate?
-
Based on future earnings growth, will it be able to continue to payout dividend at the current rate?
How well does Tiangong International fit our criteria?
Tiangong International has a trailing twelve-month payout ratio of 49.64%, meaning the dividend is sufficiently covered by earnings. Furthermore, analysts have not forecasted a dividends per share for the future, which makes it hard to determine the yield shareholders should expect, and whether the current payout is sustainable, moving forward. If dividend is a key criteria in your investment consideration, then you need to make sure the dividend stock you’re eyeing out is reliable in its payments. The reality is that it is too early to consider Tiangong International as a dividend investment. It has only been consistently paying dividends for 9 years, however, standard practice for reliable payers is to look for a 10-year minimum track record. In terms of its peers, Tiangong International has a yield of 2.68%, which is on the low-side for Metals and Mining stocks.
Next Steps:
Now you know to keep in mind the reason why investors should be careful investing in Tiangong International for the dividend. But if you are not exclusively a dividend investor, the stock could still be an interesting investment opportunity. Given that this is purely a dividend analysis, you should always research extensively before deciding whether or not a stock is an appropriate investment for you. I always recommend analysing the company’s fundamentals and underlying business before making an investment decision. I’ve put together three essential factors you should further research: