Should Robinson plc (LON:RBN) Be Part Of Your Dividend Portfolio?

A sizeable part of portfolio returns can be produced by dividend stocks due to their contribution to compounding returns in the long run. In the past 10 years Robinson plc (AIM:RBN) has returned an average of 5.00% per year to investors in the form of dividend payouts. Should it have a place in your portfolio? Let's take a look at Robinson in more detail. View our latest analysis for Robinson

How I analyze a dividend stock

When researching a dividend stock, I always follow the following screening criteria:

• Is it paying an annual yield above 75% of dividend payers?
• Has it paid dividend every year without dramatically reducing payout in the past?
• Has the amount of dividend per share grown over the past?
• Can it afford to pay the current rate of dividends from its earnings?
• Will it have the ability to keep paying its dividends going forward?

Does Robinson pass our checks?

The current trailing twelve-month payout ratio for RBN is 102.04%, meaning the dividend is not sufficiently covered by its earnings. Going forward, analysts expect RBN's payout to remain around the same level at 95.09% of its earnings, which leads to a dividend yield of 5.95%. If there is one thing that you want to be reliable in your life, it's dividend stocks and their constant income stream. Whilst its per-share payments have increased during the past 10 years, there has been some hiccups. Shareholders would have seen a few years of reduced payments in this time. In terms of its peers, Robinson has a yield of 5.79%, which is high for Packaging stocks.

Next Steps:

If you are building an income portfolio, then Robinson is a complicated choice since it has some positive aspects as well as negative ones. However, if you are not strictly just a dividend investor, the stock could still offer some interesting investment opportunities. 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. I've put together three key factors you should look at:

• 1. Future Outlook: What are well-informed industry analysts predicting for RBN’s future growth? Take a look at our free research report of analyst consensus for RBN’s outlook.
• 2. Valuation: What is RBN 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 RBN is currently mispriced by the market.
• 3. 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.