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Attention dividend hunters! Tai Sin Electric Limited (SGX:500) will be distributing its dividend of S$0.015 per share on the 15 November 2018, and will start trading ex-dividend in 4 days time on the 05 November 2018. Is this future income a persuasive enough catalyst for investors to think about Tai Sin Electric as an investment today? Below, I’m going to look at the latest data and analyze the stock and its dividend property in further detail.

Check out our latest analysis for Tai Sin Electric

Here’s how I find good dividend stocks

If you are a dividend investor, you should always assess these five key metrics:

• Is it the top 25% annual dividend yield payer?

• Has it paid dividend every year without dramatically reducing payout in the past?

• Has dividend per share amount increased over the past?

• Is is able to pay the current rate of dividends from its earnings?

• Will it be able to continue to payout at the current rate in the future?

Does Tai Sin Electric pass our checks?

The company currently pays out 63% of its earnings as a dividend, according to its trailing twelve-month data, 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.

If you want to dive deeper into the sustainability of a certain payout ratio, you may wish to consider the cash flow of the business. A company with strong cash flow, relative to earnings, can sometimes sustain a high pay out ratio.

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. Whilst its per-share payments have increased during the past 10 years, there has been some hiccups. Investors have seen reductions in the dividend per share in the past, although, it has picked up again.

Compared to its peers, Tai Sin Electric produces a yield of 6.2%, which is high for Electrical stocks but still below the market’s top dividend payers.

Next Steps:

Taking all the above into account, Tai Sin Electric is a complicated pick for dividend investors given that there are a couple of positive things about it as well as negative. 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. I’ve put together three essential aspects you should further examine: