B3 S.A. - Brasil, Bolsa, Balcão (BVMF:B3SA3) Looks Interesting, And It's About To Pay A Dividend

It looks like B3 S.A. - Brasil, Bolsa, Balcão (BVMF:B3SA3) is about to go ex-dividend in the next three days. The ex-dividend date is one business day before the record date, which is the cut-off date for shareholders to be present on the company's books to be eligible for a dividend payment. The ex-dividend date is important as the process of settlement involves two full business days. So if you miss that date, you would not show up on the company's books on the record date. Accordingly, B3 - Brasil Bolsa Balcão investors that purchase the stock on or after the 2nd of January will not receive the dividend, which will be paid on the 8th of January.

The company's upcoming dividend is R$0.0538588 a share, following on from the last 12 months, when the company distributed a total of R$0.45 per share to shareholders. Based on the last year's worth of payments, B3 - Brasil Bolsa Balcão has a trailing yield of 4.3% on the current stock price of R$10.36. 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! As a result, readers should always check whether B3 - Brasil Bolsa Balcão has been able to grow its dividends, or if the dividend might be cut.

See our latest analysis for B3 - Brasil Bolsa Balcão

Dividends are typically paid from company earnings. If a company pays more in dividends than it earned in profit, then the dividend could be unsustainable. B3 - Brasil Bolsa Balcão paid out a comfortable 47% of its profit last year.

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?

Businesses with strong growth prospects usually make the best dividend payers, because it's easier to grow dividends when earnings per share are improving. Investors love dividends, so if earnings fall and the dividend is reduced, expect a stock to be sold off heavily at the same time. Fortunately for readers, B3 - Brasil Bolsa Balcão's earnings per share have been growing at 19% a year for the past five years.

The main way most investors will assess a company's dividend prospects is by checking the historical rate of dividend growth. Since the start of our data, 10 years ago, B3 - Brasil Bolsa Balcão has lifted its dividend by approximately 11% 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.

Final Takeaway

Is B3 - Brasil Bolsa Balcão worth buying for its dividend? When companies are growing rapidly and retaining a majority of the profits within the business, it's usually a sign that reinvesting earnings creates more value than paying dividends to shareholders. Perhaps even more importantly - this can sometimes signal management is focused on the long term future of the business. In summary, B3 - Brasil Bolsa Balcão appears to have some promise as a dividend stock, and we'd suggest taking a closer look at it.

On that note, you'll want to research what risks B3 - Brasil Bolsa Balcão is facing. Our analysis shows 1 warning sign for B3 - Brasil Bolsa Balcão and you should be aware of it before buying any shares.

A common investing mistake is buying the first interesting stock you see. Here you can find a full list of high-yield dividend stocks.

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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.