Just Three Days Till Emirates NBD Bank PJSC (DFM:EMIRATESNBD) Will Be Trading Ex-Dividend

Regular readers will know that we love our dividends at Simply Wall St, which is why it's exciting to see Emirates NBD Bank PJSC (DFM:EMIRATESNBD) is about to trade ex-dividend in the next 3 days. If you purchase the stock on or after the 4th of March, you won't be eligible to receive this dividend, when it is paid on the 1st of January.

Emirates NBD Bank PJSC's next dividend payment will be د.إ0.40 per share. Last year, in total, the company distributed د.إ0.40 to shareholders. Looking at the last 12 months of distributions, Emirates NBD Bank PJSC has a trailing yield of approximately 3.6% on its current stock price of AED11.2. Dividends are a major contributor to investment returns for long term holders, but only if the dividend continues to be paid. As a result, readers should always check whether Emirates NBD Bank PJSC has been able to grow its dividends, or if the dividend might be cut.

Check out our latest analysis for Emirates NBD Bank PJSC

Dividends are usually paid out of company profits, so if a company pays out more than it earned then its dividend is usually at greater risk of being cut. Fortunately Emirates NBD Bank PJSC's payout ratio is modest, at just 40% of profit.

Generally speaking, the lower a company's payout ratios, the more resilient its dividend usually is.

Click here to see the company's payout ratio, plus analyst estimates of its future dividends.

Have Earnings And Dividends Been Growing?

When earnings decline, dividend companies become much harder to analyse and own safely. If business enters a downturn and the dividend is cut, the company could see its value fall precipitously. That's why it's not ideal to see Emirates NBD Bank PJSC's earnings per share have been shrinking at 3.2% a year over the previous five years.

Many investors will assess a company's dividend performance by evaluating how much the dividend payments have changed over time. Emirates NBD Bank PJSC has delivered 7.2% dividend growth per year on average over the past 10 years.

To Sum It Up

Should investors buy Emirates NBD Bank PJSC for the upcoming dividend? Earnings per share have shrunk noticeably in recent years, although we like that the company has a low payout ratio. This could suggest a cut to the dividend may not be a major risk in the near future. It might be worth researching if the company is reinvesting in growth projects that could grow earnings and dividends in the future, but for now we're on the fence about its dividend prospects.

Curious what other investors think of Emirates NBD Bank PJSC? See what analysts are forecasting, with this visualisation of its historical and future estimated earnings and cash flow.

If you're in the market for dividend stocks, we recommend checking our list of top dividend stocks with a greater than 2% yield and an upcoming dividend.

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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. 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.
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