Be Sure To Check Out BioPharma Credit PLC (LON:BPCR) Before It Goes Ex-Dividend

BioPharma Credit PLC (LON:BPCR) stock is about to trade ex-dividend in 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 an important date to be aware of as any purchase of the stock made on or after this date might mean a late settlement that doesn't show on the record date. Therefore, if you purchase BioPharma Credit's shares on or after the 15th of February, you won't be eligible to receive the dividend, when it is paid on the 15th of March.

The company's upcoming dividend is US$0.0295793 a share, following on from the last 12 months, when the company distributed a total of US$0.07 per share to shareholders. Looking at the last 12 months of distributions, BioPharma Credit has a trailing yield of approximately 9.7% on its current stock price of US$0.928. Dividends are a major contributor to investment returns for long term holders, but only if the dividend continues to be paid. That's why we should always check whether the dividend payments appear sustainable, and if the company is growing.

See our latest analysis for BioPharma Credit

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. BioPharma Credit is paying out an acceptable 50% of its profit, a common payout level among most companies.

Companies that pay out less in dividends than they earn in profits generally have more sustainable dividends. The lower the payout ratio, the more wiggle room the business has before it could be forced to cut the dividend.

Click here to see how much of its profit BioPharma Credit paid out over the last 12 months.

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 fall far enough, the company could be forced to cut its dividend. That's why it's comforting to see BioPharma Credit's earnings have been skyrocketing, up 33% per annum for the past five years.

Many investors will assess a company's dividend performance by evaluating how much the dividend payments have changed over time. BioPharma Credit has delivered 14% dividend growth per year on average over the past six years. Both per-share earnings and dividends have both been growing rapidly in recent times, which is great to see.

The Bottom Line

Has BioPharma Credit got what it takes to maintain its dividend payments? BioPharma Credit has an acceptable payout ratio and its earnings per share have been improving at a decent rate. We think this is a pretty attractive combination, and would be interested in investigating BioPharma Credit more closely.

On that note, you'll want to research what risks BioPharma Credit is facing. To help with this, we've discovered 1 warning sign for BioPharma Credit that you should be aware of before investing in their shares.

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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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.