Anhui Coreach TechnologyLtd's (SZSE:002983) Upcoming Dividend Will Be Larger Than Last Year's

Anhui Coreach Technology Co.,Ltd's (SZSE:002983) periodic dividend will be increasing on the 18th of June to CN¥0.3493, with investors receiving 41% more than last year's CN¥0.248. This takes the annual payment to 1.2% of the current stock price, which unfortunately is below what the industry is paying.

See our latest analysis for Anhui Coreach TechnologyLtd

Anhui Coreach TechnologyLtd's Earnings Easily Cover The Distributions

Even a low dividend yield can be attractive if it is sustained for years on end. However, Anhui Coreach TechnologyLtd's earnings easily cover the dividend. This means that most of what the business earns is being used to help it grow.

Over the next year, EPS is forecast to expand by 40.6%. If the dividend continues on this path, the payout ratio could be 42% by next year, which we think can be pretty sustainable going forward.

Anhui Coreach TechnologyLtd Is Still Building Its Track Record

Looking back, the dividend has been stable, but the company hasn't been paying a dividend for very long so we can't be confident that the dividend will remain stable through all economic environments. The dividend has gone from an annual total of CN¥0.231 in 2021 to the most recent total annual payment of CN¥0.25. This means that it has been growing its distributions at 2.7% per annum over that time. It's good to see at least some dividend growth. Yet with a relatively short dividend paying history, we wouldn't want to depend on this dividend too heavily.

We Could See Anhui Coreach TechnologyLtd's Dividend Growing

Investors could be attracted to the stock based on the quality of its payment history. It's encouraging to see that Anhui Coreach TechnologyLtd has been growing its earnings per share at 9.5% a year over the past five years. Growth in EPS bodes well for the dividend, as does the low payout ratio that the company is currently reporting.

We Really Like Anhui Coreach TechnologyLtd's Dividend

Overall, a dividend increase is always good, and we think that Anhui Coreach TechnologyLtd is a strong income stock thanks to its track record and growing earnings. Earnings are easily covering distributions, and the company is generating plenty of cash. All in all, this checks a lot of the boxes we look for when choosing an income stock.

Companies possessing a stable dividend policy will likely enjoy greater investor interest than those suffering from a more inconsistent approach. Still, investors need to consider a host of other factors, apart from dividend payments, when analysing a company. As an example, we've identified 2 warning signs for Anhui Coreach TechnologyLtd that you should be aware of before investing. Is Anhui Coreach TechnologyLtd not quite the opportunity you were looking for? Why not check out our selection of top dividend stocks.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.