Only 2 Days Left To Zhejiang Expressway Co Ltd (HKG:576)’s Ex-Dividend Date, Should You Buy?

On the 31 August 2018, Zhejiang Expressway Co Ltd (HKG:576) will be paying shareholders an upcoming dividend amount of CN¥0.30 per share. However, investors must have bought the company’s stock before 04 July 2018 in order to qualify for the payment. That means you have only 2 days left! Is this future income stream a compelling catalyst for dividend investors to think about the stock as an investment today? Let’s take a look at Zhejiang Expressway’s most recent financial data to examine its dividend characteristics in more detail. View out our latest analysis for Zhejiang Expressway

What Is A Dividend Rock Star?

It is a stock that pays a reliable and steady dividend over the past decade, at a rate that is competitive relative to the other dividend-paying companies on the market. More specifically:

  • It is paying an annual yield above 75% of dividend payers
  • It has paid dividend every year without dramatically reducing payout in the past
  • Its dividend per share amount has increased over the past
  • It is able to pay the current rate of dividends from its earnings
  • It has the ability to keep paying its dividends going forward

High Yield And Dependable

Zhejiang Expressway’s dividend yield stands at 6.25%, which is high for Infrastructure stocks. But the real reason Zhejiang Expressway stands out is because it has a high chance of being able to continue to pay dividend at this level for years to come, something that is quite desirable if you are looking to create a portfolio that generates a steady stream of income.

SEHK:576 Historical Dividend Yield July 1st 18
SEHK:576 Historical Dividend Yield July 1st 18

If dividend is a key criteria in your investment consideration, then you need to make sure the dividend stock you’re eyeing out is reliable in its payments. 576 has increased its DPS from CN¥0.35 to CN¥0.43 in the past 10 years. It has also been paying out dividend consistently during this time, as you’d expect for a company increasing its dividend levels. This is an impressive feat, which makes 576 a true dividend rockstar.

Zhejiang Expressway has a trailing twelve-month payout ratio of 48.38%, meaning the dividend is sufficiently covered by earnings. In the near future, analysts are predicting a payout ratio of 50.60%, leading to a dividend yield of around 6.95%. Furthermore, EPS should increase to CN¥0.75.

Next Steps:

Zhejiang Expressway ticks all the boxes for what I look for in a dividend stock. If you are looking to build an income focused portfolio, this could be one to include. However, given this is purely a dividend analysis, I urge potential investors to try and get a good understanding of the underlying business and its fundamentals before deciding on an investment. There are three key factors you should further research:

  1. Future Outlook: What are well-informed industry analysts predicting for 576’s future growth? Take a look at our free research report of analyst consensus for 576’s outlook.
  2. Valuation: What is 576 worth today? Even if the stock is a cash cow, it’s not worth an infinite price. The intrinsic value infographic in our free research report helps visualize whether 576 is currently mispriced by the market.
  3. Other Dividend Rockstars: Are there strong dividend payers with better fundamentals out there? Check out our free list of these great stocks here.