Changjiang Publishing & MediaLtd's (SHSE:600757) Dividend Will Be Increased To CN¥0.40

The board of Changjiang Publishing & Media Co.,Ltd (SHSE:600757) has announced that it will be paying its dividend of CN¥0.40 on the 20th of June, an increased payment from last year's comparable dividend. This takes the dividend yield to 4.5%, which shareholders will be pleased with.

Check out our latest analysis for Changjiang Publishing & MediaLtd

Changjiang Publishing & MediaLtd's Earnings Easily Cover The Distributions

A big dividend yield for a few years doesn't mean much if it can't be sustained. The last dividend was quite easily covered by Changjiang Publishing & MediaLtd's earnings. This means that a large portion of its earnings are being retained to grow the business.

Over the next year, EPS could expand by 2.5% if recent trends continue. If the dividend continues on this path, the payout ratio could be 67% by next year, which we think can be pretty sustainable going forward.

Changjiang Publishing & MediaLtd Doesn't Have A Long Payment History

It is great to see that Changjiang Publishing & MediaLtd has been paying a stable dividend for a number of years now, however we want to be a bit cautious about whether this will remain true through a full economic cycle. The dividend has gone from an annual total of CN¥0.02 in 2015 to the most recent total annual payment of CN¥0.40. This works out to be a compound annual growth rate (CAGR) of approximately 39% a year over that time. We're not overly excited about the relatively short history of dividend payments, however the dividend is growing at a nice rate and we might take a closer look.

The Dividend's Growth Prospects Are Limited

Investors could be attracted to the stock based on the quality of its payment history. Earnings have grown at around 2.5% a year for the past five years, which isn't massive but still better than seeing them shrink. Changjiang Publishing & MediaLtd is struggling to find viable investments, so it is returning more to shareholders. This isn't necessarily bad, but we wouldn't expect rapid dividend growth in the future.

Our Thoughts On Changjiang Publishing & MediaLtd's Dividend

Overall, this is a reasonable dividend, and it being raised is an added bonus. The dividend has been at reasonable levels historically, but that hasn't translated into a consistent payment. Taking all of this into consideration, the dividend looks viable moving forward, but investors should be mindful that the company has pushed the boundaries of sustainability in the past and may do so again.

Investors generally tend to favour companies with a consistent, stable dividend policy as opposed to those operating an irregular one. However, there are other things to consider for investors when analysing stock performance. As an example, we've identified 1 warning sign for Changjiang Publishing & MediaLtd that you should be aware of before investing. Is Changjiang Publishing & MediaLtd not quite the opportunity you were looking for? Why not check out 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.

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