Dividends play a key role in compounding returns over time and can form a large part of our portfolio return. Historically, 63 moons technologies limited (NSE:FINANTECH) has paid a dividend to shareholders. It currently yields 2.9%. Let’s dig deeper into whether 63 moons technologies should have a place in your portfolio.
Check out our latest analysis for 63 moons technologies
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 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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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 63 moons technologies fare?
63 moons technologies has a trailing twelve-month payout ratio of 76.3%, 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. 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. Not only have dividend payouts from 63 moons technologies fallen over the past 10 years, it has also been highly volatile during this time, with drops of over 25% in some years. This means that dividend hunters should probably steer clear of the stock, at least for now until the track record improves.
In terms of its peers, 63 moons technologies generates a yield of 2.9%, which is high for Software stocks.
Next Steps:
If you are building an income portfolio, then 63 moons technologies is a complicated choice since it has some positive aspects as well as negative ones. But if you are not exclusively a dividend investor, the stock could still be an interesting investment opportunity. 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 fundamental aspects you should look at: