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Shares of Zijin Mining Group Company Limited (SEHK:2899) will begin trading ex-dividend in 2 days. To qualify for the dividend check of CN¥0.09 per share, investors must have owned the shares prior to 21 May 2018, which is the last day the company’s management will finalize their list of shareholders to which they will send dividend payments. Is this future income a persuasive enough catalyst for investors to think about Zijin Mining Group 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. Check out our latest analysis for Zijin Mining Group
5 questions I ask before picking a dividend stock
When assessing a stock as a potential addition to my dividend Portfolio, I look at these five areas:
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Is its annual yield among the top 25% of dividend-paying companies?
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Has it consistently paid a stable dividend without missing a payment or drastically cutting payout?
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Has dividend per share amount increased over the past?
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Can it afford to pay the current rate of dividends from its earnings?
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Will it have the ability to keep paying its dividends going forward?
How well does Zijin Mining Group fit our criteria?
The current trailing twelve-month payout ratio for the stock is 57.37%, which means that the dividend is covered by earnings. However, going forward, analysts expect 2899’s payout to fall to 46.00% of its earnings, which leads to a dividend yield of around 3.86%. However, EPS should increase to CN¥0.22, meaning that the lower payout ratio does not necessarily implicate a lower dividend payment. If there’s one type of stock you want to be reliable, it’s dividend stocks and their stable income-generating ability. Whilst its per-share payments have increased during the past 10 years, there has been some hiccups. Shareholders would have seen a few years of reduced payments in this time. Relative to peers, Zijin Mining Group generates a yield of 3.15%, which is on the low-side for Metals and Mining stocks.
Next Steps:
Keeping in mind the dividend characteristics above, Zijin Mining Group is definitely worth considering for investors looking to build a dedicated income portfolio. Given that this is purely a dividend analysis, I recommend taking sufficient time to understand its core business and determine whether the company and its investment properties suit your overall goals. I’ve put together three relevant aspects you should further research:
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Future Outlook: What are well-informed industry analysts predicting for 2899’s future growth? Take a look at our free research report of analyst consensus for 2899’s outlook.
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Valuation: What is 2899 worth today? Even if the stock is a cash cow, it’s not worth an infinite price. The intrinsic value infographic in our free research report helps visualize whether 2899 is currently mispriced by the market.
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Other Dividend Rockstars: Are there better dividend payers with stronger fundamentals out there? Check out our free list of these great stocks here.
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned.