As global markets experience mixed performances, with European indices showing resilience amid fluctuating earnings reports and economic data, the Swedish market remains a focal point for dividend investors seeking stability and income. Despite broader uncertainties, Sweden's robust economy and well-established companies offer promising opportunities for those looking to invest in reliable dividend stocks. In the current market environment, a good dividend stock is typically characterized by consistent earnings, strong cash flow, and a history of stable or growing dividends. These attributes can provide investors with steady income even when broader market conditions are volatile.
Overview: Bravida Holding AB (publ) offers technical services and installations for buildings and industrial facilities across Sweden, Norway, Denmark, and Finland, with a market cap of SEK17.27 billion.
Operations: Bravida Holding AB (publ) generates revenue from providing technical services and installations for buildings and industrial facilities in Sweden, Norway, Denmark, and Finland.
Dividend Yield: 4.1%
Bravida Holding's recent earnings report showed a decline in net income and EPS despite an increase in sales. The company announced a dividend of SEK 3.50 per share for 2023, covered by both earnings (65% payout ratio) and cash flows (34.8% cash payout ratio). Despite the stable dividend payments over eight years, the company's track record is relatively short. Recent contracts with Swedish Transport Administration and Vaxholm Municipality may bolster future revenues.
Overview: Knowit AB (publ) is a consultancy company specializing in the development of digital solutions, with a market cap of SEK4.39 billion.
Operations: Knowit AB (publ) generates revenue from four primary segments: Insight (SEK898.95 million), Solutions (SEK3.90 billion), Experience (SEK1.44 billion), and Connectivity (SEK1.02 billion).
Dividend Yield: 3.2%
Knowit AB's dividend payments have been volatile over the past decade, with recent decreases. Despite a low cash payout ratio of 41.6%, earnings coverage is higher at 77.3%. The company's latest earnings report shows a decline in net income and EPS compared to last year, which may impact future dividends. Trading significantly below its estimated fair value suggests potential for capital appreciation, but the current dividend yield of 3.24% lags behind top-tier Swedish dividend payers.
Overview: Loomis AB (publ) offers services for the distribution, payments, handling, storage, and recycling of cash and other valuables with a market cap of SEK23.72 billion.
Operations: Loomis AB (publ) generates revenue from Loomis Pay (SEK77 million), Europe and Latin America (SEK14.32 billion), and the United States of America (SEK15.45 billion).
Dividend Yield: 3.7%
Loomis's dividend payments are well-covered by earnings (59.4% payout ratio) and cash flows (26.3% cash payout ratio), though they have been volatile over the past decade. The company recently increased its dividend to SEK 12.50 per share, despite a history of instability in payouts. Recent buybacks totaling nearly SEK 400 million indicate strong capital management, while Q2 2024 earnings showed growth in sales and net income, supporting future dividend sustainability.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Companies discussed in this article include OM:BRAV OM:KNOW and OM:LOOMIS.
