Conduit Holdings Limited (LON:CRE) Goes Ex-Dividend Soon

Conduit Holdings Limited (LON:CRE) stock is about to trade ex-dividend in 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. 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. Accordingly, Conduit Holdings investors that purchase the stock on or after the 17th of August will not receive the dividend, which will be paid on the 8th of September.

The company's next dividend payment will be US$0.18 per share, and in the last 12 months, the company paid a total of US$0.36 per share. Looking at the last 12 months of distributions, Conduit Holdings has a trailing yield of approximately 6.0% on its current stock price of £4.735. We love seeing companies pay a dividend, but it's also important to be sure that laying the golden eggs isn't going to kill our golden goose! As a result, readers should always check whether Conduit Holdings has been able to grow its dividends, or if the dividend might be cut.

Check out our latest analysis for Conduit Holdings

Dividends are usually paid out of company profits, so if a company pays out more than it earned then its dividend is usually at greater risk of being cut. Last year, Conduit Holdings paid out 205% of its profit to shareholders in the form of dividends. This is not sustainable behaviour and requires a closer look on behalf of the purchaser.

Generally, the higher a company's payout ratio, the more the dividend is at risk of being reduced.

Click here to see the company's payout ratio, plus analyst estimates of its future dividends.

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. Investors love dividends, so if earnings fall and the dividend is reduced, expect a stock to be sold off heavily at the same time.

The main way most investors will assess a company's dividend prospects is by checking the historical rate of dividend growth. It looks like the Conduit Holdings dividends are largely the same as they were two years ago.

The Bottom Line

Should investors buy Conduit Holdings for the upcoming dividend? It's been growing earnings per share at a pleasant rate, although its dividend payout was not well covered by earnings. It might be worth researching if the company is reinvesting in growth projects that could grow earnings and dividends in the future, but for now we're on the fence about its dividend prospects.

With that being said, if dividends aren't your biggest concern with Conduit Holdings, you should know about the other risks facing this business. Case in point: We've spotted 1 warning sign for Conduit Holdings you should be aware of.

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

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.