Regular readers will know that we love our dividends at Simply Wall St, which is why it's exciting to see Schulte-Schlagbaum AG (DUSE:SSS) is about to trade ex-dividend in the next 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 because any transaction on a stock needs to have been settled before the record date in order to be eligible for a dividend. Thus, you can purchase Schulte-Schlagbaum's shares before the 22nd of June in order to receive the dividend, which the company will pay on the 26th of June.
The company's next dividend payment will be €12.00 per share. Last year, in total, the company distributed €12.00 to shareholders. Calculating the last year's worth of payments shows that Schulte-Schlagbaum has a trailing yield of 3.1% on the current share price of €386. If you buy this business for its dividend, you should have an idea of whether Schulte-Schlagbaum's dividend is reliable and sustainable. As a result, readers should always check whether Schulte-Schlagbaum has been able to grow its dividends, or if the dividend might be cut.
Check out our latest analysis for Schulte-Schlagbaum
Dividends are typically paid out of company income, so if a company pays out more than it earned, its dividend is usually at a higher risk of being cut. Schulte-Schlagbaum paid out a comfortable 38% of its profit last year. Yet cash flow is typically more important than profit for assessing dividend sustainability, so we should always check if the company generated enough cash to afford its dividend.
Click here to see how much of its profit Schulte-Schlagbaum paid out over the last 12 months.
Have Earnings And Dividends Been Growing?
Companies with consistently growing earnings per share generally make the best dividend stocks, as they usually find it easier to grow dividends per share. 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, Schulte-Schlagbaum's earnings per share have been growing at 14% a year for the past five years.
Another key way to measure a company's dividend prospects is by measuring its historical rate of dividend growth. Schulte-Schlagbaum has delivered 0.9% dividend growth per year on average over the past 10 years. Earnings per share have been growing much quicker than dividends, potentially because Schulte-Schlagbaum is keeping back more of its profits to grow the business.