Fourlis Holdings (ATH:FOYRK) Has Announced That It Will Be Increasing Its Dividend To €0.15

Fourlis Holdings S.A.'s (ATH:FOYRK) dividend will be increasing from last year's payment of the same period to €0.15 on 3rd of July. This makes the dividend yield 4.1%, which is above the industry average.

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Fourlis Holdings' Long-term Dividend Outlook appears Promising

While it is great to have a strong dividend yield, we should also consider whether the payment is sustainable. Fourlis Holdings is unprofitable despite paying a dividend, and it is paying out 16,918% of its free cash flow. This makes us feel that the dividend will be hard to maintain.

The next year is set to see EPS grow by 36.1%. If the dividend continues on this path, the payout ratio could be 73% by next year, which we think can be pretty sustainable going forward.

View our latest analysis for Fourlis Holdings

Fourlis Holdings Doesn't Have A Long Payment History

It is great to see that Fourlis Holdings has been paying a stable dividend for a number of years now, however we want to be a bit cautious about whether this will remain true through a full economic cycle. Since 2018, the annual payment back then was €0.10, compared to the most recent full-year payment of €0.15. This means that it has been growing its distributions at 6.0% per annum over that time. Fourlis Holdings has a nice track record of dividend growth but we would wait until we see a longer track record before getting too confident.

Dividend Growth May Be Hard To Achieve

Investors could be attracted to the stock based on the quality of its payment history. With EPS growth hard to come by and the company not turning a profit, we wouldn't be particularly optimistic about the growth prospects for Fourlis Holdings' dividend in the future.

The Dividend Could Prove To Be Unreliable

Overall, this is probably not a great income stock, even though the dividend is being raised at the moment. The payments are bit high to be considered sustainable, and the track record isn't the best. This company is not in the top tier of income providing stocks.

Investors generally tend to favour companies with a consistent, stable dividend policy as opposed to those operating an irregular one. Still, investors need to consider a host of other factors, apart from dividend payments, when analysing a company. For example, we've identified 4 warning signs for Fourlis Holdings (2 shouldn't be ignored!) that you should be aware of before investing. Is Fourlis Holdings not quite the opportunity you were looking for? Why not check out 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.