ATOSS Software's (ETR:AOF) Shareholders Will Receive A Bigger Dividend Than Last Year

The board of ATOSS Software AG (ETR:AOF) has announced that it will be paying its dividend of €4.37 on the 6th of May, an increased payment from last year's comparable dividend. Although the dividend is now higher, the yield is only 0.7%, which is below the industry average.

View our latest analysis for ATOSS Software

ATOSS Software's Payment Has Solid Earnings Coverage

Even a low dividend yield can be attractive if it is sustained for years on end. Based on the last payment, ATOSS Software was quite comfortably earning enough to cover the dividend. This indicates that quite a large proportion of earnings is being invested back into the business.

EPS is set to grow by 45.8% over the next year. Assuming the dividend continues along recent trends, our estimates say the payout ratio could reach 94% - on the higher side, but we wouldn't necessarily say this is unsustainable.

ATOSS Software Has A Solid Track Record

The company has an extended history of paying stable dividends. The annual payment during the last 10 years was €0.36 in 2014, and the most recent fiscal year payment was €1.83. This works out to be a compound annual growth rate (CAGR) of approximately 18% a year over that time. So, dividends have been growing pretty quickly, and even more impressively, they haven't experienced any notable falls during this period.

The Dividend Looks Likely To Grow

The company's investors will be pleased to have been receiving dividend income for some time. ATOSS Software has seen EPS rising for the last five years, at 23% per annum. ATOSS Software is clearly able to grow rapidly while still returning cash to shareholders, positioning it to become a strong dividend payer in the future.

ATOSS Software Looks Like A Great Dividend Stock

Overall, we think this could be an attractive income stock, and it is only getting better by paying a higher dividend this year. Distributions are quite easily covered by earnings, which are also being converted to cash flows. 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. However, there are other things to consider for investors when analysing stock performance. Companies that are growing earnings tend to be the best dividend stocks over the long term. See what the 5 analysts we track are forecasting for ATOSS Software for free with public analyst estimates for the company. Looking for more high-yielding dividend ideas? Try our collection of strong dividend payers.

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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.