There's A Lot To Like About China Great Wall SecuritiesLtd's (SZSE:002939) Upcoming CN¥0.038 Dividend

It looks like China Great Wall Securities Co.,Ltd. (SZSE:002939) is about to go ex-dividend in the next 3 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 an important date to be aware of as any purchase of the stock made on or after this date might mean a late settlement that doesn't show on the record date. Therefore, if you purchase China Great Wall SecuritiesLtd's shares on or after the 20th of December, you won't be eligible to receive the dividend, when it is paid on the 20th of December.

The company's next dividend payment will be CN¥0.038 per share, on the back of last year when the company paid a total of CN¥0.11 to shareholders. Based on the last year's worth of payments, China Great Wall SecuritiesLtd has a trailing yield of 1.3% on the current stock price of CN¥8.59. 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! So we need to check whether the dividend payments are covered, and if earnings are growing.

View our latest analysis for China Great Wall SecuritiesLtd

If a company pays out more in dividends than it earned, then the dividend might become unsustainable - hardly an ideal situation. China Great Wall SecuritiesLtd paid out a comfortable 35% 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 how much of its profit China Great Wall SecuritiesLtd paid out over the last 12 months.

Have Earnings And Dividends Been Growing?

Stocks in companies that generate sustainable earnings growth often make the best dividend prospects, as it is easier to lift the dividend when earnings are rising. If business enters a downturn and the dividend is cut, the company could see its value fall precipitously. This is why it's a relief to see China Great Wall SecuritiesLtd earnings per share are up 9.8% per annum over the last five years.

Another key way to measure a company's dividend prospects is by measuring its historical rate of dividend growth. China Great Wall SecuritiesLtd has seen its dividend decline 8.8% per annum on average over the past six years, which is not great to see. China Great Wall SecuritiesLtd is a rare case where dividends have been decreasing at the same time as earnings per share have been improving. It's unusual to see, and could point to unstable conditions in the core business, or more rarely an intensified focus on reinvesting profits.

To Sum It Up

Has China Great Wall SecuritiesLtd got what it takes to maintain its dividend payments? China Great Wall SecuritiesLtd has seen its earnings per share grow slowly in recent years, and the company reinvests more than half of its profits in the business, which generally bodes well for its future prospects. Overall, China Great Wall SecuritiesLtd looks like a promising dividend stock in this analysis, and we think it would be worth investigating further.

In light of that, while China Great Wall SecuritiesLtd has an appealing dividend, it's worth knowing the risks involved with this stock. To help with this, we've discovered 1 warning sign for China Great Wall SecuritiesLtd that you should be aware of before investing in their shares.

If you're in the market for strong dividend payers, we recommend checking our selection of top 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.