ANY Biztonsági Nyomda Nyrt (BUSE:ANY) Is Paying Out A Larger Dividend Than Last Year

ANY Biztonsági Nyomda Nyrt.'s (BUSE:ANY) dividend will be increasing from last year's payment of the same period to HUF450.00 on 15th of July. This makes the dividend yield 7.1%, which is above the industry average.

While the dividend yield is important for income investors, it is also important to consider any large share price moves, as this will generally outweigh any gains from distributions. Investors will be pleased to see that ANY Biztonsági Nyomda Nyrt's stock price has increased by 39% in the last 3 months, which is good for shareholders and can also explain a decrease in the dividend yield.

We've discovered 1 warning sign about ANY Biztonsági Nyomda Nyrt. View them for free.

ANY Biztonsági Nyomda Nyrt's Future Dividend Projections Appear Well Covered By Earnings

While it is great to have a strong dividend yield, we should also consider whether the payment is sustainable. At the time of the last dividend payment, ANY Biztonsági Nyomda Nyrt was paying out a very large proportion of what it was earning and 120% of cash flows. Paying out such a high proportion of cash flows can expose the business to needing to cut the dividend if the business runs into some challenges.

Looking forward, earnings per share could rise by 44.1% over the next year if the trend from the last few years continues. Assuming the dividend continues along the course it has been charting recently, our estimates show the payout ratio being 66% which brings it into quite a comfortable range.

See our latest analysis for ANY Biztonsági Nyomda Nyrt

ANY Biztonsági Nyomda Nyrt Has A Solid Track Record

The company has been paying a dividend for a long time, and it has been quite stable which gives us confidence in the future dividend potential. The annual payment during the last 10 years was HUF73.00 in 2015, and the most recent fiscal year payment was HUF450.00. This means that it has been growing its distributions at 20% per annum over that time. We can see that payments have shown some very nice upward momentum without faltering, which provides some reassurance that future payments will also be reliable.

Dividend Growth Could Be Constrained

Investors who have held shares in the company for the past few years will be happy with the dividend income they have received. We are encouraged to see that ANY Biztonsági Nyomda Nyrt has grown earnings per share at 44% per year over the past five years. EPS is growing rapidly, although the company is also paying out a large portion of its profits as dividends. If earnings keep growing, the dividend may be sustainable, but generally we'd prefer to see a fast growing company reinvest in further growth.

Our Thoughts On ANY Biztonsági Nyomda Nyrt's Dividend

In summary, while it's always good to see the dividend being raised, we don't think ANY Biztonsági Nyomda Nyrt's payments are rock solid. 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 would be a touch cautious of relying on this stock primarily for the dividend income.

Market movements attest to how highly valued a consistent dividend policy is compared to one which is more unpredictable. Still, investors need to consider a host of other factors, apart from dividend payments, when analysing a company. For instance, we've picked out 1 warning sign for ANY Biztonsági Nyomda Nyrt that investors should take into consideration. Is ANY Biztonsági Nyomda Nyrt 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.