Yahoo Finance

Attention dividend hunters! Chargeurs SA (EPA:CRI) will be distributing its dividend of €0.30 per share on the 28 September 2018, and will start trading ex-dividend in 2 days time on the 12 September 2018. Is this future income a persuasive enough catalyst for investors to think about Chargeurs 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.

View our latest analysis for Chargeurs

Here’s how I find good dividend stocks

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

• Is their annual yield among the top 25% of dividend payers?

• Has its dividend been stable over the past (i.e. no missed payments or significant payout cuts)?

• Has dividend per share risen in the past couple of years?

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

• Will it have the ability to keep paying its dividends going forward?

How well does Chargeurs fit our criteria?

Chargeurs has a trailing twelve-month payout ratio of 57.0%, which means that the dividend is covered by earnings. In the near future, analysts are predicting lower payout ratio of 50.9%, leading to a dividend yield of 3.4%. However, EPS should increase to €1.44, meaning that the lower payout ratio does not necessarily implicate a lower dividend payment.

When assessing the forecast sustainability of a dividend it is also worth considering the cash flow of the business. Companies with strong cash flow can sustain a higher payout ratio, while companies with weaker cash flow generally cannot.

Reliablity is an important factor for dividend stocks, particularly for income investors who want a strong track record of payment and a positive outlook for future payout. Dividend payments from Chargeurs have been volatile in the past 10 years, with some years experiencing significant drops of over 25%. This means that dividend hunters should probably steer clear of the stock, at least for now until the track record improves.

Relative to peers, Chargeurs produces a yield of 2.8%, which is high for Luxury stocks but still below the market’s top dividend payers.

Next Steps:

Taking all the above into account, Chargeurs is a complicated pick for dividend investors given that there are a couple of positive things about it as well as negative. However, if you are not strictly just a dividend investor, the stock could still offer 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. There are three key aspects you should further research: