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Lorne Park Capital Partners Inc. (CVE:LPC) is about to trade ex-dividend in the next four days. The ex-dividend date is two business days before a company's record date in most cases, which is the date on which the company determines which shareholders are entitled to receive a dividend. The ex-dividend date is important as the process of settlement involves at least two full business days. So if you miss that date, you would not show up on the company's books on the record date. Therefore, if you purchase Lorne Park Capital Partners' shares on or after the 16th of April, you won't be eligible to receive the dividend, when it is paid on the 30th of April.
The company's next dividend payment will be CA$0.01 per share. Last year, in total, the company distributed CA$0.032 to shareholders. Based on the last year's worth of payments, Lorne Park Capital Partners stock has a trailing yield of around 2.4% on the current share price of CA$1.35. If you buy this business for its dividend, you should have an idea of whether Lorne Park Capital Partners's dividend is reliable and sustainable. So we need to investigate whether Lorne Park Capital Partners can afford its dividend, and if the dividend could grow.
Dividends are usually paid out of company profits, so if a company pays out more than it earned then its dividend is usually at greater risk of being cut. Lorne Park Capital Partners paid out 57% of its earnings to investors last year, a normal payout level for most businesses.
When a company paid out less in dividends than it earned in profit, this generally suggests its dividend is affordable. The lower the % of its profit that it pays out, the greater the margin of safety for the dividend if the business enters a downturn.
See our latest analysis for Lorne Park Capital Partners
Click here to see how much of its profit Lorne Park Capital Partners paid out over the last 12 months.
Have Earnings And Dividends Been Growing?
Stocks in companies that generate sustainable earnings growth often make the best dividend prospects, as it is easier to lift the dividend when earnings are rising. Investors love dividends, so if earnings fall and the dividend is reduced, expect a stock to be sold off heavily at the same time. Fortunately for readers, Lorne Park Capital Partners's earnings per share have been growing at 18% a year for the past five years.
Many investors will assess a company's dividend performance by evaluating how much the dividend payments have changed over time. Lorne Park Capital Partners has delivered 12% dividend growth per year on average over the past four years. Both per-share earnings and dividends have both been growing rapidly in recent times, which is great to see.