Be Sure To Check Out Amanat Holdings PJSC (DFM:AMANAT) Before It Goes Ex-Dividend

Regular readers will know that we love our dividends at Simply Wall St, which is why it's exciting to see Amanat Holdings PJSC (DFM:AMANAT) is about to trade ex-dividend in the next 3 days. The ex-dividend date is two business days before a company's record date in most cases, which is the date on which the company determines which shareholders are entitled to receive a dividend. The ex-dividend date is important because any transaction on a stock needs to have been settled before the record date in order to be eligible for a dividend. In other words, investors can purchase Amanat Holdings PJSC's shares before the 25th of April in order to be eligible for the dividend, which will be paid on the 1st of January.

The company's next dividend payment will be د.إ0.016 per share, and in the last 12 months, the company paid a total of د.إ0.046 per share. Calculating the last year's worth of payments shows that Amanat Holdings PJSC has a trailing yield of 4.2% on the current share price of د.إ1.09. Dividends are a major contributor to investment returns for long term holders, but only if the dividend continues to be paid. We need to see whether the dividend is covered by earnings and if it's growing.

We've found 21 US stocks that are forecast to pay a dividend yield of over 6% next year. See the full list for free.

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. Its dividend payout ratio is 80% of profit, which means the company is paying out a majority of its earnings. The relatively limited profit reinvestment could slow the rate of future earnings growth. We'd be concerned if earnings began to decline.

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

View our latest analysis for Amanat Holdings PJSC

Click here to see how much of its profit Amanat Holdings PJSC paid out over the last 12 months.

Have Earnings And Dividends Been Growing?

Businesses with strong growth prospects usually make the best dividend payers, because it's easier to grow dividends when earnings per share are improving. If business enters a downturn and the dividend is cut, the company could see its value fall precipitously. Fortunately for readers, Amanat Holdings PJSC's earnings per share have been growing at 19% 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. Amanat Holdings PJSC has delivered 13% dividend growth per year on average over the past nine years. It's exciting to see that both earnings and dividends per share have grown rapidly over the past few years.

The Bottom Line

Is Amanat Holdings PJSC worth buying for its dividend? Earnings per share are growing at an attractive rate, and Amanat Holdings PJSC is paying out a bit over half its profits. We think this is a pretty attractive combination, and would be interested in investigating Amanat Holdings PJSC more closely.

In light of that, while Amanat Holdings PJSC has an appealing dividend, it's worth knowing the risks involved with this stock. Our analysis shows 2 warning signs for Amanat Holdings PJSC that we strongly recommend you have a look at before investing in the company.

Generally, we wouldn't recommend just buying the first dividend stock you see. Here's a curated list of interesting stocks that are strong dividend payers.

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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.