Sino Land's (HKG:83) Dividend Will Be HK$0.43

Sino Land Company Limited (HKG:83) has announced that it will pay a dividend of HK$0.43 per share on the 2nd of December. This means that the annual payment will be 6.3% of the current stock price, which is in line with the average for the industry.

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Estimates Indicate Sino Land's Could Struggle to Maintain Dividend Payments In The Future

We like to see a healthy dividend yield, but that is only helpful to us if the payment can continue. Based on the last payment, the company wasn't making enough to cover what it was paying to shareholders. It will be difficult to sustain this level of payout so we wouldn't be confident about this continuing.

Earnings per share is forecast to rise by 16.4% over the next year. If the dividend continues on its recent course, the payout ratio in 12 months could be 115%, which is a bit high and could start applying pressure to the balance sheet.

See our latest analysis for Sino Land

Sino Land Has A Solid Track Record

The company has an extended history of paying stable dividends. The dividend has gone from an annual total of HK$0.50 in 2015 to the most recent total annual payment of HK$0.58. This works out to be a compound annual growth rate (CAGR) of approximately 1.5% a year over that time. While the consistency in the dividend payments is impressive, we think the relatively slow rate of growth is less attractive.

Sino Land's Dividend Might Lack Growth

Some investors will be chomping at the bit to buy some of the company's stock based on its dividend history. We are encouraged to see that Sino Land has grown earnings per share at 12% per year over the past five years. However, the payout ratio is very high, not leaving much room for growth of the dividend in the future.

Sino Land's Dividend Doesn't Look Sustainable

Overall, we don't think this company makes a great dividend stock, even though the dividend wasn't cut this year. We can't deny that the payments have been very stable, but we are a little bit worried about the very high payout ratio. We don't think Sino Land is a great stock to add to your portfolio if income is your focus.

Investors generally tend to favour companies with a consistent, stable dividend policy as opposed to those operating an irregular one. At the same time, there are other factors our readers should be conscious of before pouring capital into a stock. As an example, we've identified 1 warning sign for Sino Land that you should be aware of before investing. Is Sino Land 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.