There's A Lot To Like About Stradim Espace Finances' (EPA:ALSAS) Upcoming €0.38 Dividend

It looks like Stradim Espace Finances SA (EPA:ALSAS) is about to go ex-dividend in the next 3 days. The ex-dividend date is one business day before a company's record date, which is the date on which the company determines which shareholders are entitled to receive a dividend. It is important to be aware of the ex-dividend date because any trade on the stock needs to have been settled on or before the record date. In other words, investors can purchase Stradim Espace Finances' shares before the 23rd of August in order to be eligible for the dividend, which will be paid on the 25th of August.

The company's next dividend payment will be €0.38 per share, and in the last 12 months, the company paid a total of €0.38 per share. Calculating the last year's worth of payments shows that Stradim Espace Finances has a trailing yield of 4.8% on the current share price of €7.95. If you buy this business for its dividend, you should have an idea of whether Stradim Espace Finances's dividend is reliable and sustainable. We need to see whether the dividend is covered by earnings and if it's growing.

Check out our latest analysis for Stradim Espace Finances

Dividends are typically paid from company earnings. If a company pays more in dividends than it earned in profit, then the dividend could be unsustainable. That's why it's good to see Stradim Espace Finances paying out a modest 26% of its earnings.

Click here to see how much of its profit Stradim Espace Finances paid out over the last 12 months.

Have Earnings And Dividends Been Growing?

Businesses with strong growth prospects usually make the best dividend payers, because it's easier to grow dividends when earnings per share are improving. If earnings decline and the company is forced to cut its dividend, investors could watch the value of their investment go up in smoke. With that in mind, it's good to see earnings have grown 14% on last year.

One year is a very short time frame in the pantheon of investing, so we wouldn't get too hung up on these numbers.

The main way most investors will assess a company's dividend prospects is by checking the historical rate of dividend growth. Stradim Espace Finances has delivered 2.4% dividend growth per year on average over the past 10 years. Earnings per share have been growing much quicker than dividends, potentially because Stradim Espace Finances is keeping back more of its profits to grow the business.

The Bottom Line

Has Stradim Espace Finances got what it takes to maintain its dividend payments? It's great that Stradim Espace Finances is growing earnings per share while simultaneously paying out a low percentage of both its earnings and cash flow. It's disappointing to see the dividend has been cut at least once in the past, but as things stand now, the low payout ratio suggests a conservative approach to dividends, which we like. Stradim Espace Finances looks solid on this analysis overall, and we'd definitely consider investigating it more closely.

While it's tempting to invest in Stradim Espace Finances for the dividends alone, you should always be mindful of the risks involved. Every company has risks, and we've spotted 5 warning signs for Stradim Espace Finances (of which 1 is a bit concerning!) you should know about.

Generally, we wouldn't recommend just buying the first dividend stock you see. Here's a curated list of interesting stocks that are 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.