Eezy Oyj's (HEL:EEZY) Dividend Will Be €0.05

The board of Eezy Oyj (HEL:EEZY) has announced that it will pay a dividend on the 26th of October, with investors receiving €0.05 per share. This makes the dividend yield 5.4%, which will augment investor returns quite nicely.

View our latest analysis for Eezy Oyj

Eezy Oyj's Dividend Is Well Covered By Earnings

Impressive dividend yields are good, but this doesn't matter much if the payments can't be sustained. The last dividend was quite easily covered by Eezy Oyj's earnings. This means that a large portion of its earnings are being retained to grow the business.

Looking forward, earnings per share is forecast to rise by 52.4% over the next year. If the dividend continues along recent trends, we estimate the payout ratio will be 38%, which is in the range that makes us comfortable with the sustainability of the dividend.

Eezy Oyj Doesn't Have A Long Payment History

The dividend hasn't seen any major cuts in the past, but the company has only been paying a dividend for 4 years, which isn't that long in the grand scheme of things. Since 2019, the annual payment back then was €0.08, compared to the most recent full-year payment of €0.15. This means that it has been growing its distributions at 17% per annum over that time. Eezy Oyj has been growing its dividend quite rapidly, which is exciting. However, the short payment history makes us question whether this performance will persist across a full market cycle.

The Dividend Looks Likely To Grow

Some investors will be chomping at the bit to buy some of the company's stock based on its dividend history. We are encouraged to see that Eezy Oyj has grown earnings per share at 20% per year over the past three years. Earnings are on the uptrend, and it is only paying a small portion of those earnings to shareholders.

Eezy Oyj Looks Like A Great Dividend Stock

Overall, we like to see the dividend staying consistent, and we think Eezy Oyj might even raise payments in the future. 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.

It's important to note that companies having a consistent dividend policy will generate greater investor confidence than those having an erratic one. At the same time, there are other factors our readers should be conscious of before pouring capital into a stock. As an example, we've identified 3 warning signs for Eezy Oyj that you should be aware of before investing. Is Eezy Oyj 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.