Regina Miracle International (Holdings) Limited (HKG:2199) Pays A HK$0.05 Dividend In Just Four Days

Regina Miracle International (Holdings) Limited (HKG:2199) stock is about to trade ex-dividend in 4 days. The ex-dividend date is commonly two business days before the record date, which is the cut-off date for shareholders to be present on the company's books to be eligible for a dividend payment. It is important to be aware of the ex-dividend date because any trade on the stock needs to have been settled on or before the record date. Therefore, if you purchase Regina Miracle International (Holdings)'s shares on or after the 20th of April, you won't be eligible to receive the dividend, when it is paid on the 30th of April.

The company's next dividend payment will be HK$0.05 per share, and in the last 12 months, the company paid a total of HK$0.11 per share. Looking at the last 12 months of distributions, Regina Miracle International (Holdings) has a trailing yield of approximately 5.7% on its current stock price of HK$2.00. Dividends are an important source of income to many shareholders, but the health of the business is crucial to maintaining those dividends. That's why we should always check whether the dividend payments appear sustainable, and if the company is growing.

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If a company pays out more in dividends than it earned, then the dividend might become unsustainable - hardly an ideal situation. That's why it's good to see Regina Miracle International (Holdings) paying out a modest 47% of its earnings. A useful secondary check can be to evaluate whether Regina Miracle International (Holdings) generated enough free cash flow to afford its dividend. It paid out 5.4% of its free cash flow as dividends last year, which is conservatively low.

It's encouraging to see that the dividend is covered by both profit and cash flow. This generally suggests the dividend is sustainable, as long as earnings don't drop precipitously.

Check out our latest analysis for Regina Miracle International (Holdings)

Click here to see the company's payout ratio, plus analyst estimates of its future dividends.

Have Earnings And Dividends Been Growing?

When earnings decline, dividend companies become much harder to analyse and own safely. If earnings fall far enough, the company could be forced to cut its dividend. So we're not too excited that Regina Miracle International (Holdings)'s earnings are down 2.1% a year over the past five years.

The main way most investors will assess a company's dividend prospects is by checking the historical rate of dividend growth. Regina Miracle International (Holdings) has delivered 7.4% dividend growth per year on average over the past 10 years.

To Sum It Up

Should investors buy Regina Miracle International (Holdings) for the upcoming dividend? Earnings per share are down meaningfully, although at least the company is paying out a low and conservative percentage of both its earnings and cash flow. It's definitely not great to see earnings falling, but at least there may be some buffer before the dividend needs to be cut. While it does have some good things going for it, we're a bit ambivalent and it would take more to convince us of Regina Miracle International (Holdings)'s dividend merits.

With that in mind, a critical part of thorough stock research is being aware of any risks that stock currently faces. To that end, you should learn about the 3 warning signs we've spotted with Regina Miracle International (Holdings) (including 1 which is potentially serious).

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.