Cello World's (NSE:CELLO) Dividend Will Be ₹1.50

Cello World Limited's (NSE:CELLO) investors are due to receive a payment of ₹1.50 per share on 7th of September. This means the annual payment will be 0.2% of the current stock price, which is lower than the industry average.

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Cello World's Projected Earnings Seem Likely To Cover Future Distributions

The dividend yield is a little bit low, but sustainability of the payments is also an important part of evaluating an income stock. Before making this announcement, Cello World was easily earning enough to cover the dividend. This means that most of what the business earns is being used to help it grow.

Over the next year, EPS is forecast to expand by 67.6%. Assuming the dividend continues along recent trends, we think the payout ratio could be 5.8% by next year, which is in a pretty sustainable range.

Check out our latest analysis for Cello World

Cello World Doesn't Have A Long Payment History

The company hasn't been paying a dividend for very long at all, so we can't really make a judgement on how stable the dividend has been. This doesn't mean that the company can't pay a good dividend, but just that we want to wait until it can prove itself.

The Dividend Looks Likely To Grow

The company's investors will be pleased to have been receiving dividend income for some time. Cello World has impressed us by growing EPS at 15% per year over the past five years. With a decent amount of growth and a low payout ratio, we think this bodes well for Cello World's prospects of growing its dividend payments in the future.

We Really Like Cello World's Dividend

In summary, it is good to see that the dividend is staying consistent, and we don't think there is any reason to suspect this might change over the medium term. The company is easily earning enough to cover its dividend payments and it is great to see that these earnings are being translated into cash flow. All of these factors considered, we think this has solid potential as a dividend stock.

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. Earnings growth generally bodes well for the future value of company dividend payments. See if the 7 Cello World analysts we track are forecasting continued growth with our free report on analyst estimates for the company. Is Cello World not quite the opportunity you were looking for? Why not check out our selection of top dividend stocks.

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