Peiport Holdings (HKG:2885) Has Re-Affirmed Its Dividend Of HK$0.013

The board of Peiport Holdings Ltd. (HKG:2885) has announced that it will pay a dividend on the 8th of July, with investors receiving HK$0.013 per share. This payment means the dividend yield will be 3.3%, which is below the average for the industry.

View our latest analysis for Peiport Holdings

Peiport Holdings' Payment Has Solid Earnings Coverage

If it is predictable over a long period, even low dividend yields can be attractive. Before making this announcement, Peiport Holdings was easily earning enough to cover the dividend. This means that most of what the business earns is being used to help it grow.

Over the next year, EPS could expand by 3.4% if recent trends continue. If the dividend continues on this path, the payout ratio could be 31% by next year, which we think can be pretty sustainable going forward.

Peiport Holdings Doesn't Have A Long Payment History

Without a track record of dividend payments, we can't make a judgement on how stable it has been. This doesn't mean that the company can't pay a good dividend, but just that we want to wait until it can prove itself.

Peiport Holdings May Find It Hard To Grow The Dividend

Some investors will be chomping at the bit to buy some of the company's stock based on its dividend history. Earnings have grown at around 3.4% a year for the past three years, which isn't massive but still better than seeing them shrink. While EPS growth is quite low, Peiport Holdings has the option to increase the payout ratio to return more cash to shareholders.

In Summary

In summary, we are pleased with the dividend remaining consistent, and we think there is a good chance of this continuing in the future. While the payout ratios are a good sign, we are less enthusiastic about the company's dividend record. The dividend looks okay, but there have been some issues in the past, so we would be a little bit cautious.

Market movements attest to how highly valued a consistent dividend policy is compared to one which is more unpredictable. At the same time, there are other factors our readers should be conscious of before pouring capital into a stock. Case in point: We've spotted 4 warning signs for Peiport Holdings (of which 1 can't be ignored!) you should know about. Is Peiport Holdings not quite the opportunity you were looking for? Why not check out our selection of top dividend stocks.

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