Intron Technology Holdings' (HKG:1760) Dividend Will Be Reduced To CN¥0.098

Intron Technology Holdings Limited's (HKG:1760) dividend is being reduced from last year's payment covering the same period to CN¥0.098 on the 2nd of July. The dividend yield will be in the average range for the industry at 5.2%.

View our latest analysis for Intron Technology Holdings

Intron Technology Holdings' Earnings Easily Cover The Distributions

We like to see a healthy dividend yield, but that is only helpful to us if the payment can continue. However, Intron Technology Holdings' earnings easily cover the dividend. This means that most of what the business earns is being used to help it grow.

Over the next year, EPS is forecast to expand by 81.6%. If the dividend continues along recent trends, we estimate the payout ratio will be 23%, which is in the range that makes us comfortable with the sustainability of the dividend.

Intron Technology Holdings' Dividend Has Lacked Consistency

Intron Technology Holdings has been paying dividends for a while, but the track record isn't stellar. This suggests that the dividend might not be the most reliable. The dividend has gone from an annual total of CN¥0.0469 in 2019 to the most recent total annual payment of CN¥0.0902. This works out to be a compound annual growth rate (CAGR) of approximately 14% a year over that time. Despite the rapid growth in the dividend over the past number of years, we have seen the payments go down the past as well, so that makes us cautious.

We Could See Intron Technology Holdings' Dividend Growing

With a relatively unstable dividend, it's even more important to evaluate if earnings per share is growing, which could point to a growing dividend in the future. Intron Technology Holdings has impressed us by growing EPS at 9.6% per year over the past five years. Intron Technology Holdings definitely has the potential to grow its dividend in the future with earnings on an uptrend and a low payout ratio.

Intron Technology Holdings Looks Like A Great Dividend Stock

Overall, we think that Intron Technology Holdings could be a great option for a dividend investment, although we would have preferred if the dividend wasn't cut this year. Reducing the amount it is paying as a dividend can protect the company's balance sheet, keeping the dividend sustainable for longer. All of these factors considered, we think this has solid potential as a dividend stock.

It's important to note that companies having a consistent dividend policy will generate greater investor confidence than those having an erratic 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 Intron Technology Holdings (1 is concerning!) that you should be aware of before investing. Is Intron Technology 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.