I.B.I. Investment House Ltd (TLV:IBI) Looks Like A Good Stock, And It's Going Ex-Dividend Soon

It looks like I.B.I. Investment House Ltd (TLV:IBI) is about to go ex-dividend in the next 2 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 an important date to be aware of as any purchase of the stock made on or after this date might mean a late settlement that doesn't show on the record date. Accordingly, I.B.I. Investment House investors that purchase the stock on or after the 27th of August will not receive the dividend, which will be paid on the 3rd of September.

The company's next dividend payment will be ₪2.36336 per share, and in the last 12 months, the company paid a total of ₪6.16 per share. Based on the last year's worth of payments, I.B.I. Investment House has a trailing yield of 5.2% on the current stock price of ₪119.30. Dividends are a major contributor to investment returns for long term holders, but only if the dividend continues to be paid. So we need to investigate whether I.B.I. Investment House can afford its dividend, and if the dividend could grow.

View our latest analysis for I.B.I. Investment House

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. I.B.I. Investment House paid out more than half (60%) of its earnings last year, which is a regular payout ratio for most companies.

Generally speaking, the lower a company's payout ratios, the more resilient its dividend usually is.

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

Have Earnings And Dividends Been Growing?

Stocks in companies that generate sustainable earnings growth often make the best dividend prospects, as it is easier to lift the dividend when earnings are rising. If earnings fall far enough, the company could be forced to cut its dividend. Fortunately for readers, I.B.I. Investment House's earnings per share have been growing at 16% a year for the past five years.

The main way most investors will assess a company's dividend prospects is by checking the historical rate of dividend growth. Since the start of our data, 10 years ago, I.B.I. Investment House has lifted its dividend by approximately 15% a year on average. Both per-share earnings and dividends have both been growing rapidly in recent times, which is great to see.

Final Takeaway

From a dividend perspective, should investors buy or avoid I.B.I. Investment House? Earnings per share are growing at an attractive rate, and I.B.I. Investment House is paying out a bit over half its profits. Overall, I.B.I. Investment House looks like a promising dividend stock in this analysis, and we think it would be worth investigating further.

On that note, you'll want to research what risks I.B.I. Investment House is facing. Our analysis shows 2 warning signs for I.B.I. Investment House and you should be aware of these before buying any shares.

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.