Interested In Highland Gold Mining Limited (LON:HGM)’s Upcoming £0.05 Dividend? You Have 3 Days Left

Shares of Highland Gold Mining Limited (AIM:HGM) will begin trading ex-dividend in 3 days. To qualify for the dividend check of $0.05 per share, investors must have owned the shares prior to 26 April 2018, which is the last day the company's management will finalize their list of shareholders to which they will send dividend payments. Is this future income stream a compelling catalyst for dividend investors to think about the stock as an investment today? Let's take a look at Highland Gold Mining's most recent financial data to examine its dividend characteristics in more detail. Check out our latest analysis for Highland Gold Mining

5 questions to ask before buying a dividend stock

If you are a dividend investor, you should always assess these five key metrics:

• Is its annual yield among the top 25% of dividend-paying companies?
• Has it paid dividend every year without dramatically reducing payout in the past?
• Has the amount of dividend per share grown over the past?
• Is its earnings sufficient to payout dividend at the current rate?
• Will it have the ability to keep paying its dividends going forward?

How well does Highland Gold Mining fit our criteria?

Highland Gold Mining has a trailing twelve-month payout ratio of 47.59%, meaning the dividend is sufficiently covered by earnings. Going forward, analysts expect HGM's payout to remain around the same level at 43.92% of its earnings, which leads to a dividend yield of 6.17%. In addition to this, EPS should increase to $0.25. If dividend is a key criteria in your investment consideration, then you need to make sure the dividend stock you're eyeing out is reliable in its payments. Unfortunately, it is really too early to view Highland Gold Mining as a dividend investment. It has only been consistently paying dividends for 7 years, however, standard practice for reliable payers is to look for a 10-year minimum track record. In terms of its peers, Highland Gold Mining has a yield of 7.41%, which is high for Metals and Mining stocks.

Next Steps:

Taking into account the dividend metrics, Highland Gold Mining ticks most of the boxes as a strong dividend investment, putting it in my list of top dividend payers. Given that this is purely a dividend analysis, you should always research extensively before deciding whether or not a stock is an appropriate investment for you. I always recommend analysing the company's fundamentals and underlying business before making an investment decision. Below, I've compiled three essential factors you should further examine:

1. Future Outlook: What are well-informed industry analysts predicting for HGM’s future growth? Take a look at our free research report of analyst consensus for HGM’s outlook.
2. Valuation: What is HGM worth today? Even if the stock is a cash cow, it's not worth an infinite price. The intrinsic value infographic in our free research report helps visualize whether HGM is currently mispriced by the market.
3. Other Dividend Rockstars: Are there better dividend payers with stronger fundamentals out there? Check out our free list of these great stocks here.

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Simply Wall St analyst Simply Wall St and Simply Wall St have no position in any of the companies mentioned. This article 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.