Some investors rely on dividends for growing their wealth, and if you're one of those dividend sleuths, you might be intrigued to know that Best of the Best PLC (LON:BOTB) is about to go ex-dividend in just 3 days. Typically, the ex-dividend date is one business day before the record date which is the date on which a company determines the shareholders eligible to receive a dividend. The ex-dividend date is important as the process of settlement involves two full business days. So if you miss that date, you would not show up on the company's books on the record date. Accordingly, Best of the Best investors that purchase the stock on or after the 1st of July will not receive the dividend, which will be paid on the 16th of July.

The company's upcoming dividend is UK£0.50 a share, following on from the last 12 months, when the company distributed a total of UK£0.95 per share to shareholders. Based on the last year's worth of payments, Best of the Best has a trailing yield of 5.6% on the current stock price of £17. If you buy this business for its dividend, you should have an idea of whether Best of the Best's dividend is reliable and sustainable. So we need to check whether the dividend payments are covered, and if earnings are growing.

Check out our latest analysis for Best of the Best

If a company pays out more in dividends than it earned, then the dividend might become unsustainable - hardly an ideal situation. Best of the Best is paying out just 4.1% of its profit after tax, which is comfortably low and leaves plenty of breathing room in the case of adverse events. That said, even highly profitable companies sometimes might not generate enough cash to pay the dividend, which is why we should always check if the dividend is covered by cash flow. It paid out 2.3% of its free cash flow as dividends last year, which is conservatively low.

It's encouraging to see that the dividend is covered by both profit and cash flow. This generally suggests the dividend is sustainable, as long as earnings don't drop precipitously.

Click here to see how much of its profit Best of the Best paid out over the last 12 months.

Have Earnings And Dividends Been Growing?

Businesses with strong growth prospects usually make the best dividend payers, because it's easier to grow dividends when earnings per share are improving. If earnings fall far enough, the company could be forced to cut its dividend. That's why it's comforting to see Best of the Best's earnings have been skyrocketing, up 66% per annum for the past five years. With earnings per share growing rapidly and the company sensibly reinvesting almost all of its profits within the business, Best of the Best looks like a promising growth company.