BioSyent's (CVE:RX) Dividend Will Be CA$0.045

BioSyent Inc.'s (CVE:RX) investors are due to receive a payment of CA$0.045 per share on 15th of September. Including this payment, the dividend yield on the stock will be 1.7%, which is a modest boost for shareholders' returns.

See our latest analysis for BioSyent

BioSyent's Earnings Easily Cover The Distributions

Even a low dividend yield can be attractive if it is sustained for years on end. Before making this announcement, BioSyent was easily earning enough to cover the dividend. As a result, a large proportion of what it earned was being reinvested back into the business.

The next year is set to see EPS grow by 10.7%. If the dividend continues on this path, the payout ratio could be 26% by next year, which we think can be pretty sustainable going forward.

BioSyent Is Still Building Its Track Record

It's not possible for us to make a backward looking judgement just based on a short payment history. This doesn't mean that the company can't pay a good dividend, but just that we want to wait until it can prove itself.

The Dividend Looks Likely To Grow

The company's investors will be pleased to have been receiving dividend income for some time. BioSyent has impressed us by growing EPS at 14% per year over the past five years. BioSyent definitely has the potential to grow its dividend in the future with earnings on an uptrend and a low payout ratio.

We Really Like BioSyent's Dividend

In summary, it is good to see that the dividend is staying consistent, and we don't think there is any reason to suspect this might change over the medium term. The company is easily earning enough to cover its dividend payments and it is great to see that these earnings are being translated into cash flow. All of these factors considered, we think this has solid potential as a dividend stock.

It's important to note that companies having a consistent dividend policy will generate greater investor confidence than those having an erratic one. However, there are other things to consider for investors when analysing stock performance. For example, we've picked out 2 warning signs for BioSyent that investors should know about before committing capital to this stock. Is BioSyent not quite the opportunity you were looking for? Why not check out our selection of top dividend stocks.

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