Be Sure To Check Out BASSAC Société anonyme (EPA:BASS) Before It Goes Ex-Dividend

By
Simply Wall St
Published
May 13, 2022
ENXTPA:BASS
Source: Shutterstock

Some investors rely on dividends for growing their wealth, and if you're one of those dividend sleuths, you might be intrigued to know that BASSAC Société anonyme (EPA:BASS) is about to go ex-dividend in just 3 days. Typically, the ex-dividend date is one business day before the record date which is the date on which a company determines the shareholders eligible to receive a dividend. The ex-dividend date is important as the process of settlement involves two full business days. So if you miss that date, you would not show up on the company's books on the record date. Accordingly, BASSAC Société anonyme investors that purchase the stock on or after the 17th of May will not receive the dividend, which will be paid on the 19th of May.

The company's next dividend payment will be €2.50 per share. Last year, in total, the company distributed €2.50 to shareholders. Based on the last year's worth of payments, BASSAC Société anonyme has a trailing yield of 3.6% on the current stock price of €70. If you buy this business for its dividend, you should have an idea of whether BASSAC Société anonyme's dividend is reliable and sustainable. As a result, readers should always check whether BASSAC Société anonyme has been able to grow its dividends, or if the dividend might be cut.

See our latest analysis for BASSAC Société anonyme

If a company pays out more in dividends than it earned, then the dividend might become unsustainable - hardly an ideal situation. Fortunately BASSAC Société anonyme's payout ratio is modest, at just 25% of profit. That said, even highly profitable companies sometimes might not generate enough cash to pay the dividend, which is why we should always check if the dividend is covered by cash flow. What's good is that dividends were well covered by free cash flow, with the company paying out 22% of its cash flow last year.

It's positive to see that BASSAC Société anonyme's dividend is covered by both profits and cash flow, since this is generally a sign that the dividend is sustainable, and a lower payout ratio usually suggests a greater margin of safety before the dividend gets cut.

Click here to see how much of its profit BASSAC Société anonyme paid out over the last 12 months.

historic-dividend
ENXTPA:BASS Historic Dividend May 13th 2022

Have Earnings And Dividends Been Growing?

Companies with consistently growing earnings per share generally make the best dividend stocks, as they usually find it easier to grow dividends per share. If earnings decline and the company is forced to cut its dividend, investors could watch the value of their investment go up in smoke. That's why it's comforting to see BASSAC Société anonyme's earnings have been skyrocketing, up 29% per annum for the past five years. BASSAC Société anonyme is paying out less than half its earnings and cash flow, while simultaneously growing earnings per share at a rapid clip. This is a very favourable combination that can often lead to the dividend multiplying over the long term, if earnings grow and the company pays out a higher percentage of its earnings.

Another key way to measure a company's dividend prospects is by measuring its historical rate of dividend growth. Since the start of our data, 10 years ago, BASSAC Société anonyme has lifted its dividend by approximately 17% a year on average. Both per-share earnings and dividends have both been growing rapidly in recent times, which is great to see.

Final Takeaway

Has BASSAC Société anonyme got what it takes to maintain its dividend payments? BASSAC Société anonyme has been growing earnings at a rapid rate, and has a conservatively low payout ratio, implying that it is reinvesting heavily in its business; a sterling combination. It's a promising combination that should mark this company worthy of closer attention.

With that in mind, a critical part of thorough stock research is being aware of any risks that stock currently faces. For example, BASSAC Société anonyme has 2 warning signs (and 1 which is potentially serious) we think you should know about.

A common investing mistake is buying the first interesting stock you see. Here you can find a full list of high-yield dividend stocks.

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