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?

AIM:RBN Historical Dividend Yield Feb 23rd 18
AIM:RBN Historical Dividend Yield Feb 23rd 18

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: