Important news for shareholders and potential investors in British Land Company (LSE:BLND): The dividend payment of £0.07 will be distributed into shareholder’s accounts on Fri 04 Aug 2017 but the stock will begin trading ex-dividend already on the Thu 29 Jun 2017. So if you want to cash in on that dividend and are not a shareholder yet, you have only few days left. But is this actually an interesting opportunity for dividend investors? Today I’m going to investigate the latest data and dive into some metrics you shouldn’t overlook.
What is the ex-dividend date?
If you purchase a stock on or after its ex-dividend date, you will not receive the next dividend payment. Instead, the seller gets the dividend. If you purchase before the ex-dividend date, you get the dividend.
What should you know before buying British Land Company (BLND) for its dividend
British Land Company’s payout ratio is the first thing I want to look at to assess the strength of it’s dividend yield.
Payout ratio is a measure of how much of a company’s earnings are paid out as dividends to its shareholders. So a payout ratio of 50% would mean for every $1 earnt they pay 50c as a dividend. Likewise a payout ratio of 150% means the company is paying out more as a dividend than it earns, usually this is paid out of debt or cash.
The current payout ratio for the stock is 153%, meaning the dividend is not sufficiently covered by earnings. In 3 years time the analysts are predicting dividends per share to be around £0.34 and EPS to increase to £0.39. This means they should be able to continue the dividend payout with an estimated future payout ratio of 86%.
On top of British Land Company’s payout ratio, investors should also look at the company’s track-record of dividend payments over the years.
If there is one thing that you want to be reliable, it is dividend stocks. BLND investors will be well aware there has been no increase in the dividend payments in the last 10 years, although at least they have been consistently paying.
British Land Company yields 4.71%, which is high for a real estate stock.
Taking all the above into account, British Land Company is a complicated pick for dividend investors although there is a couple of positive things about it.On the other hand, if you are not strictly just a dividend investor, BLND could still be offering some interesting investment opportunities.
See our latest analysis (it’s FREE) to explore what investment opportunities British Land Company may offer. If you are looking for great dividend payers I recommend you also take a look at our list of Dividend Rock Stars.