The Hong Kong market has seen mixed performance recently, with the Hang Seng Index gaining 2.14% amidst global economic uncertainties and a series of underwhelming corporate earnings reports in China. As investors navigate these turbulent times, dividend stocks yielding over 7.1% can offer a reliable income stream and potential stability. In this context, selecting strong dividend stocks involves looking for companies with robust financial health, consistent earnings, and a commitment to returning capital to shareholders through dividends.
Overview: Financial Street Property Co., Limited, along with its subsidiaries, offers property management and related services in the People’s Republic of China and has a market cap of HK$814.23 million.
Operations: Financial Street Property Co., Limited generates CN¥1.62 billion from its property management and related services in the People’s Republic of China.
Dividend Yield: 8.7%
Financial Street Property's dividends are covered by earnings (payout ratio: 52%) and cash flows (cash payout ratio: 54.6%). Despite a high yield of 8.72%, the dividend history is volatile with payments for less than ten years. Recent earnings show sales increased to CNY 813.69 million, but net income dropped to CNY 63.47 million for the half year ended June 30, 2024, indicating potential challenges in sustaining payouts long-term.
Overview: Stella International Holdings Limited is an investment holding company involved in the development, manufacture, and sale of footwear products and leather goods across North America, China, Europe, Asia, and internationally, with a market cap of approximately HK$11.99 billion.
Operations: Stella International Holdings Limited generates revenue primarily from its manufacturing segment ($1.55 billion) and retailing and wholesaling segment ($2.84 million).
Dividend Yield: 8.5%
Stella International Holdings' dividends are covered by earnings (payout ratio: 72.6%) and cash flows (cash payout ratio: 54%). Despite a high yield, the dividend history has been volatile over the past decade. Recent results show strong performance with net income rising to US$91.94 million for H1 2024 from US$55.72 million a year ago, and an interim dividend of HKD 0.65 per share declared, payable on September 20, 2024.
Overview: Huishang Bank Corporation Limited, along with its subsidiaries, offers a range of commercial banking products and services in the People’s Republic of China and has a market cap of HK$30.97 billion.
Operations: Huishang Bank Corporation Limited generates revenue from various commercial banking products and services in the People’s Republic of China.
Dividend Yield: 7.2%
Huishang Bank's dividends are well-covered by earnings with a low payout ratio of 14%, though the dividend history has been volatile over the past decade. Recent results for H1 2024 show net income increased to ¥8.63 billion from ¥8.10 billion a year ago, despite a slight decline in net interest income. The bank approved a final dividend of RMB 1.46 per 10 shares for FY2023, but also withdrew proposed dividends from prior years, indicating some instability in payouts.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Companies discussed in this article include SEHK:1502 SEHK:1836 and SEHK:3698.
