Be Sure To Check Out F.I.B.I. Holdings Ltd (TLV:FIBIH) Before It Goes Ex-Dividend

Regular readers will know that we love our dividends at Simply Wall St, which is why it's exciting to see F.I.B.I. Holdings Ltd (TLV:FIBIH) is about to trade ex-dividend in the next two days. The ex-dividend date is one business day before a company's record date, which is the date on which the company determines which shareholders are entitled to receive a dividend. 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 F.I.B.I. Holdings' shares on or after the 1st of September will not receive the dividend, which will be paid on the 9th of September.

The company's upcoming dividend is ₪3.3001774 a share, following on from the last 12 months, when the company distributed a total of ₪10.77 per share to shareholders. Last year's total dividend payments show that F.I.B.I. Holdings has a trailing yield of 6.9% on the current share price of ₪155.30. Dividends are an important source of income to many shareholders, but the health of the business is crucial to maintaining those dividends. So we need to investigate whether F.I.B.I. Holdings can afford its dividend, and if the dividend could grow.

See our latest analysis for F.I.B.I. Holdings

Dividends are typically paid from company earnings. If a company pays more in dividends than it earned in profit, then the dividend could be unsustainable. That's why it's good to see F.I.B.I. Holdings paying out a modest 38% of its earnings.

When a company paid out less in dividends than it earned in profit, this generally suggests its dividend is affordable. The lower the % of its profit that it pays out, the greater the margin of safety for the dividend if the business enters a downturn.

Click here to see how much of its profit F.I.B.I. Holdings paid out over the last 12 months.

Have Earnings And Dividends Been Growing?

Businesses with strong growth prospects usually make the best dividend payers, because it's easier to grow dividends when earnings per share are improving. If earnings fall far enough, the company could be forced to cut its dividend. That's why it's comforting to see F.I.B.I. Holdings's earnings have been skyrocketing, up 24% per annum for the past five years.

Many investors will assess a company's dividend performance by evaluating how much the dividend payments have changed over time. F.I.B.I. Holdings has delivered 26% dividend growth per year on average over the past eight years. It's great to see earnings per share growing rapidly over several years, and dividends per share growing right along with it.

Final Takeaway

Should investors buy F.I.B.I. Holdings for the upcoming dividend? When companies are growing rapidly and retaining a majority of the profits within the business, it's usually a sign that reinvesting earnings creates more value than paying dividends to shareholders. Perhaps even more importantly - this can sometimes signal management is focused on the long term future of the business. In summary, F.I.B.I. Holdings appears to have some promise as a dividend stock, and we'd suggest taking a closer look at it.

So while F.I.B.I. Holdings looks good from a dividend perspective, it's always worthwhile being up to date with the risks involved in this stock. For example - F.I.B.I. Holdings has 1 warning sign we think you should be aware of.

Generally, we wouldn't recommend just buying the first dividend stock you see. Here's a curated list of interesting stocks that are strong dividend payers.

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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.