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Have you been keeping an eye on Venture Corporation Limited’s (SGX:V03) upcoming dividend of SGD0.6 per share payable on the 31 May 2018? Then you only have 2 days left before the stock starts trading ex-dividend on the 17 May 2018. Should you diversify into Venture and boost your portfolio income stream? Well, keep on reading because today, 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 Venture
How I analyze a dividend stock
When researching a dividend stock, I always follow the following screening criteria:
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Is its annual yield among the top 25% of dividend-paying companies?
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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 it increased its dividend per share amount over the past?
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Does earnings amply cover its dividend payments?
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Will the company be able to keep paying dividend based on the future earnings growth?
How does Venture fare?
The company currently pays out 41.75% of its earnings as a dividend, according to its trailing twelve-month data, meaning the dividend is sufficiently covered by earnings. Going forward, analysts expect V03’s payout to remain around the same level at 41.14% of its earnings, which leads to a dividend yield of around 3.22%. In addition to this, EPS should increase to SGD1.55. If there’s one type of stock you want to be reliable, it’s dividend stocks and their stable income-generating ability. V03 has increased its DPS from SGD0.5 to SGD0.6 in the past 10 years. It has also been paying out dividend consistently during this time, as you’d expect for a company increasing its dividend levels. These are all positive signs of a great, reliable dividend stock. Relative to peers, Venture produces a yield of 2.79%, which is on the low-side for Electronic stocks.
Next Steps:
With this in mind, I definitely rank Venture as a strong dividend stock, and makes it worth further research for anyone who likes steady income generation from their 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. There are three essential aspects you should look at:
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Future Outlook: What are well-informed industry analysts predicting for V03’s future growth? Take a look at our free research report of analyst consensus for V03’s outlook.
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Valuation: What is V03 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 V03 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.