Three Days Left To Buy Atlantic Grupa d.d. (ZGSE:ATGR) Before The Ex-Dividend Date

Atlantic Grupa d.d. (ZGSE:ATGR) is about to trade ex-dividend in the next three days. The ex-dividend date is one business day 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. The ex-dividend date is of consequence because whenever a stock is bought or sold, the trade takes at least two business day to settle. This means that investors who purchase Atlantic Grupa d.d's shares on or after the 4th of July will not receive the dividend, which will be paid on the 12th of July.

The company's next dividend payment will be €1.20 per share, and in the last 12 months, the company paid a total of €1.20 per share. Calculating the last year's worth of payments shows that Atlantic Grupa d.d has a trailing yield of 2.2% on the current share price of €54.00. Dividends are a major contributor to investment returns for long term holders, but only if the dividend continues to be paid. As a result, readers should always check whether Atlantic Grupa d.d has been able to grow its dividends, or if the dividend might be cut.

See our latest analysis for Atlantic Grupa d.d

Dividends are usually paid out of company profits, so if a company pays out more than it earned then its dividend is usually at greater risk of being cut. Atlantic Grupa d.d paid out 51% of its earnings to investors last year, a normal payout level for most businesses. A useful secondary check can be to evaluate whether Atlantic Grupa d.d generated enough free cash flow to afford its dividend. It distributed 41% of its free cash flow as dividends, a comfortable payout level for most companies.

It's positive to see that Atlantic Grupa d.d's dividend is covered by both profits and cash flow, since this is generally a sign that the dividend is sustainable, and a lower payout ratio usually suggests a greater margin of safety before the dividend gets cut.

Click here to see how much of its profit Atlantic Grupa d.d paid out over the last 12 months.

Have Earnings And Dividends Been Growing?

Companies that aren't growing their earnings can still be valuable, but it is even more important to assess the sustainability of the dividend if it looks like the company will struggle to grow. If earnings fall far enough, the company could be forced to cut its dividend. It's not encouraging to see that Atlantic Grupa d.d's earnings are effectively flat over the past five years. We'd take that over an earnings decline any day, but in the long run, the best dividend stocks all grow their earnings per share.

Many investors will assess a company's dividend performance by evaluating how much the dividend payments have changed over time. Atlantic Grupa d.d has delivered an average of 15% per year annual increase in its dividend, based on the past 10 years of dividend payments.

Final Takeaway

Is Atlantic Grupa d.d an attractive dividend stock, or better left on the shelf? We're not enthused by the flat earnings per share, although at least the company's payout ratio is within reasonable bounds. Additionally, it paid out a lower percentage of its free cash flow, so at least it generated more cash than it spent on dividends. In summary, while it has some positive characteristics, we're not inclined to race out and buy Atlantic Grupa d.d today.

Want to learn more about Atlantic Grupa d.d's dividend performance? Check out this visualisation of its historical revenue and earnings growth.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com