Bridgemarq Real Estate Services' (TSE:BRE) Dividend Will Be CA$0.11

By
Simply Wall St
Published
April 21, 2022
TSX:BRE
Source: Shutterstock

Bridgemarq Real Estate Services Inc.'s (TSE:BRE) investors are due to receive a payment of CA$0.11 per share on 31st of May. The dividend yield will be 8.5% based on this payment which is still above the industry average.

See our latest analysis for Bridgemarq Real Estate Services

Bridgemarq Real Estate Services Doesn't Earn Enough To Cover Its Payments

If the payments aren't sustainable, a high yield for a few years won't matter that much. Prior to this announcement, the company was paying out 269% of what it was earning. It will be difficult to sustain this level of payout so we wouldn't be confident about this continuing.

Looking forward, EPS could fall by 11.2% if the company can't turn things around from the last few years. If the dividend continues along the path it has been on recently, the payout ratio in 12 months could be 415%, which is definitely a bit high to be sustainable going forward.

historic-dividend
TSX:BRE Historic Dividend April 21st 2022

Dividend Volatility

The company's dividend history has been marked by instability, with at least 1 cut in the last 10 years. The first annual payment during the last 10 years was CA$1.30 in 2012, and the most recent fiscal year payment was CA$1.35. Dividend payments have been growing, but very slowly over the period. It's encouraging to see some dividend growth, but the dividend has been cut at least once, and the size of the cut would eliminate most of the growth anyway, which makes this less attractive as an income investment.

Dividend Growth Potential Is Shaky

Growing earnings per share could be a mitigating factor when considering the past fluctuations in the dividend. Bridgemarq Real Estate Services' earnings per share has shrunk at 11% a year over the past five years. A sharp decline in earnings per share is not great from from a dividend perspective. Even conservative payout ratios can come under pressure if earnings fall far enough.

We're Not Big Fans Of Bridgemarq Real Estate Services' Dividend

Overall, this isn't a great candidate as an income investment, even though the dividend was stable this year. The company's earnings aren't high enough to be making such big distributions, and it isn't backed up by strong growth or consistency either. Overall, this doesn't get us very excited from an income standpoint.

Market movements attest to how highly valued a consistent dividend policy is compared to one which is more unpredictable. Meanwhile, despite the importance of dividend payments, they are not the only factors our readers should know when assessing a company. Case in point: We've spotted 4 warning signs for Bridgemarq Real Estate Services (of which 3 don't sit too well with us!) you should know about. If you are a dividend investor, you might also want to look at our curated list of high yield dividend stocks.

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