In This Article:
Important news for shareholders and potential investors in Time Watch Investments Limited (HKG:2033): The dividend payment of HK$0.037 per share will be distributed to shareholders on 07 December 2018, and the stock will begin trading ex-dividend at an earlier date, 26 November 2018. Is this future income stream a compelling catalyst for dividend investors to think about the stock as an investment today? Let’s take a look at Time Watch Investments’s most recent financial data to examine its dividend characteristics in more detail.
View our latest analysis for Time Watch Investments
5 checks you should use to assess 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?
-
Does it consistently pay out dividends without missing a payment of significantly cutting payout?
-
Has the amount of dividend per share grown over the past?
-
Is is able to pay the current rate of dividends from its earnings?
-
Will it have the ability to keep paying its dividends going forward?
How does Time Watch Investments fare?
The current trailing twelve-month payout ratio for the stock is 41%, which means that the dividend is 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.
When assessing the forecast sustainability of a dividend it is also worth considering the cash flow of the business. A business with strong cash flow can sustain a higher divided payout ratio than a company with weak cash flow.
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. Unfortunately, it is really too early to view Time Watch Investments as a dividend investment. It has only been consistently paying dividends for 5 years, however, standard practice for reliable payers is to look for a 10-year minimum track record.
In terms of its peers, Time Watch Investments produces a yield of 5.0%, which is high for Luxury stocks but still below the market’s top dividend payers.
Next Steps:
Now you know to keep in mind the reason why investors should be careful investing in Time Watch Investments 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, I urge potential investors to try and get a good understanding of the underlying business and its fundamentals before deciding on an investment. Below, I’ve compiled three key aspects you should further research: