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If you are interested in cashing in on Kingboard Holdings Limited’s (HKG:148) upcoming dividend of HK$1.10 per share, you only have 4 days left to buy the shares before its ex-dividend date, 26 October 2018, in time for dividends payable on the 07 December 2018. Is this future income a persuasive enough catalyst for investors to think about Kingboard Holdings 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 Kingboard Holdings
How I analyze a dividend stock
When researching a dividend stock, I always follow the following screening criteria:
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Does it pay an annual yield higher than 75% of dividend payers?
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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 the amount of dividend per share grown over the past?
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Is its earnings sufficient to payout dividend at the current rate?
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Will it have the ability to keep paying its dividends going forward?
How does Kingboard Holdings fare?
The current trailing twelve-month payout ratio for the stock is 22%, which means that the dividend is covered by earnings. Going forward, analysts expect 148’s payout to increase to 36% of its earnings, which leads to a dividend yield of 7.2%. However, EPS is forecasted to fall to HK$4.42 in the upcoming year. Therefore, although payout is expected to increase, the fall in earnings may not equate to higher dividend income.
When assessing the forecast sustainability of a dividend it is also worth considering the cash flow of the business. Cash flow is important because companies with strong cash flow can usually sustain higher payout ratios.
If there is one thing that you want to be reliable in your life, it’s dividend stocks and their constant income stream. 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, Kingboard Holdings generates a yield of 6.6%, which is high for Electronic stocks.
Next Steps:
With these dividend metrics in mind, I definitely rank Kingboard Holdings as a strong income stock, and is worth further research for anyone who considers dividends an important part of their portfolio strategy. 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. Below, I’ve compiled three fundamental aspects you should look at: