If you are interested in cashing in on LSL Property Services Plc’s (LSE:LSL) upcoming dividend of £0.07 per share, you only have 3 days left to buy the shares before its ex-dividend date, 22 March 2018, in time for dividends payable on the 05 May 2018. Investors looking for higher income-generating stocks to add to their portfolio should keep reading, as I examine LSL Property Services’s latest financial data to analyse its dividend characteristics. View our latest analysis for LSL Property Services

5 questions to ask before buying a dividend stock

If you are a dividend investor, you should always assess these five key metrics:

• Does it pay an annual yield higher than 75% of dividend payers?

• Does it consistently pay out dividends without missing a payment or significantly cutting payout?

• Has the amount of dividend per share grown over the past?

• Is its earnings sufficient to payout dividend at the current rate?

• Based on future earnings growth, will it be able to continue to payout dividend at the current rate?

How does LSL Property Services fare?

LSL Property Services has a trailing twelve-month payout ratio of 34.71%, meaning the dividend is sufficiently covered by earnings. Going forward, analysts expect LSL’s payout to increase to 39.90% of its earnings, which leads to a dividend yield of 4.51%. However, EPS is forecasted to fall to £0.28 in the upcoming year. Therefore, although payout is expected to increase, the fall in earnings may not equate to higher dividend income. If there is one thing that you want to be reliable in your life, it’s dividend stocks and their constant income stream. Although LSL’s per share payments have increased in the past 10 years, it has not been a completely smooth ride. Investors have seen reductions in the dividend per share in the past, although, it has picked up again. In terms of its peers, LSL Property Services generates a yield of 4.83%, which is high for Real Estate stocks.

Next Steps:

With these dividend metrics in mind, I definitely rank LSL Property Services 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, 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. There are three important factors you should look at:

1. Future Outlook: What are well-informed industry analysts predicting for LSL’s future growth? Take a look at our free research report of analyst consensus for LSL’s outlook.

2. Valuation: What is LSL 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 LSL is currently mispriced by the market.

3. 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.