Shares of Boardroom Limited (SGX:B10) will begin trading ex-dividend in 2 days. To qualify for the dividend check of S$0.02 per share, investors must have owned the shares prior to 30 April 2019, which is the last day the company's management will finalize their list of shareholders to which they will send dividend payments. Should you diversify into Boardroom and boost your portfolio income stream? Well, keep on reading because today, I'm going to look at the latest data and analyze the stock and its dividend property in further detail.

See our latest analysis for Boardroom

5 questions I ask before picking a dividend stock

When researching a dividend stock, I always follow the following screening criteria:

• Does it pay an annual yield higher than 75% of dividend payers?

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

• Has it increased its dividend per share amount over the past?

• Is its earnings sufficient to payout dividend at the current rate?

• Will the company be able to keep paying dividend based on the future earnings growth?

How well does Boardroom fit our criteria?

The company currently pays out 57% of its earnings as a dividend, according to its trailing twelve-month data, 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.

When considering the sustainability of dividends, it is also worth checking the cash flow of a company. Cash flow is important because companies with strong cash flow can usually sustain higher payout ratios.

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. Not only have dividend payouts from Boardroom fallen over the past 10 years, it has also been highly volatile during this time, with drops of over 25% in some years. These characteristics do not bode well for income investors seeking reliable stream of dividends.

Compared to its peers, Boardroom generates a yield of 2.6%, which is high for Professional Services stocks but still below the market's top dividend payers.

Next Steps:

After digging a little deeper into Boardroom's yield, it's easy to see why you should be cautious investing in the company just for the dividend. On the other hand, if you are not strictly just a dividend investor, the stock could still be offering some interesting investment opportunities. 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. Below, I've compiled three relevant aspects you should further examine: