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Attention dividend hunters! Chuang’s Consortium International Limited (HKG:367) will be distributing its dividend of HK$0.05 per share on the 31 October 2018, and will start trading ex-dividend in 4 days time on the 03 October 2018. Investors looking for higher income-generating stocks to add to their portfolio should keep reading, as I examine Chuang’s Consortium International’s latest financial data to analyse its dividend characteristics.
Check out our latest analysis for Chuang’s Consortium International
5 questions I ask before picking a dividend stock
If you are a dividend investor, you should always assess these five key metrics:
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Is it the top 25% annual dividend yield payer?
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Has its dividend been stable over the past (i.e. no missed payments or significant payout cuts)?
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Has dividend per share risen in the past couple of years?
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Does earnings amply cover its dividend payments?
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Based on future earnings growth, will it be able to continue to payout dividend at the current rate?
How well does Chuang’s Consortium International fit our criteria?
The company currently pays out 10.3% of its earnings as a dividend, according to its trailing twelve-month data, which means that the dividend is covered by earnings. Furthermore, analysts have not forecasted a dividends per share for the future, which makes it hard to determine the yield shareholders should expect, and whether the current payout is sustainable, moving forward.
When considering the sustainability of dividends, it is also worth checking the cash flow of a company. A company with strong cash flow, relative to earnings, can sometimes sustain a high pay out ratio.
If dividend is a key criteria in your investment consideration, then you need to make sure the dividend stock you’re eyeing out is reliable in its payments. 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.
In terms of its peers, Chuang’s Consortium International produces a yield of 6.1%, which is high for Real Estate stocks.
Next Steps:
Keeping in mind the dividend characteristics above, Chuang’s Consortium International is definitely worth considering for investors looking to build a dedicated income portfolio. 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. I’ve put together three key aspects you should look at: