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It looks like Graubündner Kantonalbank (VTX:GRKP) is about to go ex-dividend in the next four days. The ex-dividend date is one business day before the record date, which is the cut-off date for shareholders to be present on the company's books to be eligible for a dividend payment. The ex-dividend date is of consequence because whenever a stock is bought or sold, the trade takes at least two business day to settle. In other words, investors can purchase Graubündner Kantonalbank's shares before the 8th of March in order to be eligible for the dividend, which will be paid on the 12th of March.
The company's next dividend payment will be CHF047.50 per share, and in the last 12 months, the company paid a total of CHF47.50 per share. Looking at the last 12 months of distributions, Graubündner Kantonalbank has a trailing yield of approximately 2.7% on its current stock price of CHF01785.00. Dividends are a major contributor to investment returns for long term holders, but only if the dividend continues to be paid. That's why we should always check whether the dividend payments appear sustainable, and if the company is growing.
View our latest analysis for Graubündner Kantonalbank
Dividends are typically paid from company earnings. If a company pays more in dividends than it earned in profit, then the dividend could be unsustainable. Graubündner Kantonalbank paid out 54% of its earnings to investors last year, a normal payout level for most businesses.
Companies that pay out less in dividends than they earn in profits generally have more sustainable dividends. The lower the payout ratio, the more wiggle room the business has before it could be forced to cut the dividend.
Click here to see how much of its profit Graubündner Kantonalbank 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 business enters a downturn and the dividend is cut, the company could see its value fall precipitously. With that in mind, it's good to see earnings have grown 3.7% on last year.
One year is not very long in the grand scheme of things though, so we wouldn't draw too strong a conclusion based on these results.
The main way most investors will assess a company's dividend prospects is by checking the historical rate of dividend growth. In the last 10 years, Graubündner Kantonalbank has lifted its dividend by approximately 2.3% a year on average. It's encouraging to see the company lifting dividends while earnings are growing, suggesting at least some corporate interest in rewarding shareholders.