Tyman (LON:TYMN) Has Announced A Dividend Of £0.095

Tyman plc's (LON:TYMN) investors are due to receive a payment of £0.095 per share on 29th of May. This means the annual payment is 4.7% of the current stock price, which is above the average for the industry.

View our latest analysis for Tyman

Tyman's Payment Has Solid Earnings Coverage

A big dividend yield for a few years doesn't mean much if it can't be sustained. Based on the last payment, Tyman was quite comfortably earning enough to cover the dividend. This means that a large portion of its earnings are being retained to grow the business.

The next year is set to see EPS grow by 61.3%. If the dividend continues along recent trends, we estimate the payout ratio will be 46%, which is in the range that makes us comfortable with the sustainability of the dividend.

Dividend Volatility

The company's dividend history has been marked by instability, with at least one cut in the last 10 years. The annual payment during the last 10 years was £0.05 in 2014, and the most recent fiscal year payment was £0.137. This implies that the company grew its distributions at a yearly rate of about 11% over that duration. Despite the rapid growth in the dividend over the past number of years, we have seen the payments go down the past as well, so that makes us cautious.

Tyman Could Grow Its Dividend

With a relatively unstable dividend, it's even more important to see if earnings per share is growing. Tyman has seen EPS rising for the last five years, at 7.4% per annum. Shareholders are getting plenty of the earnings returned to them, which combined with strong growth makes this quite appealing.

Our Thoughts On Tyman's Dividend

Overall, a consistent dividend is a good thing, and we think that Tyman has the ability to continue this into the future. The payout ratio looks good, but unfortunately the company's dividend track record isn't stellar. The payment isn't stellar, but it could make a decent addition to a dividend portfolio.

Investors generally tend to favour companies with a consistent, stable dividend policy as opposed to those operating an irregular one. Still, investors need to consider a host of other factors, apart from dividend payments, when analysing a company. For example, we've picked out 1 warning sign for Tyman that investors should know about before committing capital to this stock. Looking for more high-yielding dividend ideas? Try our collection of strong dividend payers.

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