Readers hoping to buy Bright Smart Securities & Commodities Group Limited (HKG:1428) for its dividend will need to make their move shortly, as the stock is about to trade ex-dividend. You can purchase shares before the 6th of February in order to receive the dividend, which the company will pay on the 28th of February.
The upcoming dividend for Bright Smart Securities & Commodities Group is HK$0.80 per share, increased from last year’s total dividends per share of HK$0.078. We love seeing companies pay a dividend, but it’s also important to be sure that laying the golden eggs isn’t going to kill our golden goose! So we need to investigate whether Bright Smart Securities & Commodities Group can afford its dividend, and if the dividend could grow.
Dividends are typically paid out of company income, so if a company pays out more than it earned, its dividend is usually at a higher risk of being cut. Fortunately Bright Smart Securities & Commodities Group’s payout ratio is modest, at just 32% of profit.
Generally speaking, the lower a company’s payout ratios, the more resilient its dividend usually is.
Have Earnings And Dividends Been Growing?
Companies with consistently growing earnings per share generally make the best dividend stocks, as they usually find it easier to grow dividends per share. If earnings fall far enough, the company could be forced to cut its dividend. Fortunately for readers, Bright Smart Securities & Commodities Group’s earnings per share have been growing at 11% a year for the past five years.
Many investors will assess a company’s dividend performance by evaluating how much the dividend payments have changed over time. In the last nine years, Bright Smart Securities & Commodities Group has lifted its dividend by approximately 18% a year on average. It’s great to see earnings per share growing rapidly over several years, and dividends per share growing right along with it.
Is Bright Smart Securities & Commodities Group worth buying for its dividend? Typically, companies that are growing rapidly and paying out a low fraction of earnings are keeping the profits for reinvestment in the business. This is one of the most attractive investment combinations under this analysis, as it can create substantial value for investors over the long run. Overall, Bright Smart Securities & Commodities Group looks like a promising dividend stock in this analysis, and we think it would be worth investigating further.
Want to learn more about Bright Smart Securities & Commodities Group’s dividend performance? Check out this visualisation of its historical revenue and earnings growth.
We wouldn’t recommend just buying the first dividend stock you see, though. Here’s a list of interesting dividend stocks with a greater than 2% yield and an upcoming dividend.
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.
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