Read This Before Considering Premia Real Estate Investment Company Societe Anonyme (ATH:PREMIA) For Its Upcoming €0.03 Dividend

Regular readers will know that we love our dividends at Simply Wall St, which is why it's exciting to see Premia Real Estate Investment Company Societe Anonyme (ATH:PREMIA) is about to trade ex-dividend in the next couple of days. The ex-dividend date occurs one day before the record date which is the day on which shareholders need to be on the company's books in order to receive a dividend. The ex-dividend date is important as the process of settlement involves two full business days. So if you miss that date, you would not show up on the company's books on the record date. Therefore, if you purchase Premia Real Estate Investment Company Societe Anonyme's shares on or after the 6th of June, you won't be eligible to receive the dividend, when it is paid on the 13th of June.

The company's next dividend payment will be €0.03 per share, and in the last 12 months, the company paid a total of €0.02 per share. Looking at the last 12 months of distributions, Premia Real Estate Investment Company Societe Anonyme has a trailing yield of approximately 1.7% on its current stock price of €1.18. 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! We need to see whether the dividend is covered by earnings and if it's growing.

See our latest analysis for Premia Real Estate Investment Company Societe Anonyme

If a company pays out more in dividends than it earned, then the dividend might become unsustainable - hardly an ideal situation. Premia Real Estate Investment Company Societe Anonyme paid out just 13% of its profit last year, which we think is conservatively low and leaves plenty of margin for unexpected circumstances.

Click here to see how much of its profit Premia Real Estate Investment Company Societe Anonyme paid out over the last 12 months.

Have Earnings And Dividends Been Growing?

When earnings decline, dividend companies become much harder to analyse and own safely. Investors love dividends, so if earnings fall and the dividend is reduced, expect a stock to be sold off heavily at the same time. Premia Real Estate Investment Company Societe Anonyme's earnings have collapsed faster than Wile E Coyote's schemes to trap the Road Runner; down a tremendous 46% a year over the past five years.

Unfortunately Premia Real Estate Investment Company Societe Anonyme has only been paying a dividend for a year or so, so there's not much of a history to draw insight from.

The Bottom Line

Is Premia Real Estate Investment Company Societe Anonyme an attractive dividend stock, or better left on the shelf? Premia Real Estate Investment Company Societe Anonyme's earnings per share are down over the past five years, although it has the cushion of a low payout ratio, which would suggest a cut to the dividend is relatively unlikely. In summary, Premia Real Estate Investment Company Societe Anonyme appears to have some promise as a dividend stock, and we'd suggest taking a closer look at it.

While it's tempting to invest in Premia Real Estate Investment Company Societe Anonyme for the dividends alone, you should always be mindful of the risks involved. We've identified 3 warning signs with Premia Real Estate Investment Company Societe Anonyme (at least 1 which is concerning), and understanding these should be part of your investment process.

If you're in the market for strong dividend payers, we recommend checking our selection of top 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.