A sizeable part of portfolio returns can be produced by dividend stocks due to their contribution to compounding returns in the long run. Schaffner Holding AG (VTX:SAHN) has returned to shareholders over the past 10 years, an average dividend yield of 1.00% annually. Let’s dig deeper into whether Schaffner Holding should have a place in your portfolio. View out our latest analysis for Schaffner Holding
How I analyze a dividend stock
When researching a dividend stock, I always follow the following screening criteria:
- Is its annual yield among the top 25% of dividend-paying companies?
- Has it paid dividend every year without dramatically reducing payout in the past?
- Has the amount of dividend per share grown over the past?
- Does earnings amply cover its dividend payments?
- Will the company be able to keep paying dividend based on the future earnings growth?
Does Schaffner Holding pass our checks?
The company currently pays out 48.37% of its earnings as a dividend, according to its trailing twelve-month data, meaning the dividend is sufficiently covered by earnings. Furthermore, analysts have not forecasted a dividends per share for the future, which makes it hard to determine the yield shareholders should expect, and whether the current payout is sustainable, moving forward.
If dividend is a key criteria in your investment consideration, then you need to make sure the dividend stock you’re eyeing out is reliable in its payments. Whilst its per-share payments have increased during the past 10 years, there has been some hiccups. Shareholders would have seen a few years of reduced payments in this time.Relative to peers, Schaffner Holding has a yield of 2.01%, which is on the low-side for Electronic stocks.
If Schaffner Holding is in your portfolio for cash-generating reasons, there may be better alternatives out there. However, if you are not strictly just a dividend investor, the stock could still offer some interesting investment opportunities. Given that this is purely a dividend analysis, I recommend taking sufficient time to understand its core business and determine whether the company and its investment properties suit your overall goals. Below, I’ve compiled three fundamental factors you should further research:
- Future Outlook: What are well-informed industry analysts predicting for SAHN’s future growth? Take a look at our free research report of analyst consensus for SAHN’s outlook.
- Historical Performance: What has SAHN’s returns been like over the past? Go into more detail in the past track record analysis and take a look at the free visual representations of our analysis for more clarity.
- Dividend Rockstars: Are there better dividend payers with stronger fundamentals out there? Check out our free list of these great stocks here.