Bodhi Tree Multimedia Limited (NSE:BTML) Will Pay A ₹0.50 Dividend In Three Days

Readers hoping to buy Bodhi Tree Multimedia Limited (NSE:BTML) for its dividend will need to make their move shortly, as the stock is about to trade ex-dividend. The ex-dividend date is usually set to be one business day before the record date which is the cut-off date on which you must be present on the company's books as a shareholder in order to receive the dividend. The ex-dividend date is important as the process of settlement involves two full business days. So if you miss that date, you would not show up on the company's books on the record date. Meaning, you will need to purchase Bodhi Tree Multimedia's shares before the 29th of February to receive the dividend, which will be paid on the 17th of March.

The company's next dividend payment will be ₹0.50 per share. Last year, in total, the company distributed ₹0.50 to shareholders. Based on the last year's worth of payments, Bodhi Tree Multimedia has a trailing yield of 0.3% on the current stock price of ₹183.30. If you buy this business for its dividend, you should have an idea of whether Bodhi Tree Multimedia's dividend is reliable and sustainable. That's why we should always check whether the dividend payments appear sustainable, and if the company is growing.

View our latest analysis for Bodhi Tree Multimedia

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. Bodhi Tree Multimedia has a low and conservative payout ratio of just 13% of its income after tax.

Click here to see how much of its profit Bodhi Tree Multimedia paid out over the last 12 months.

Have Earnings And Dividends Been Growing?

Companies with falling earnings are riskier for dividend shareholders. If business enters a downturn and the dividend is cut, the company could see its value fall precipitously. Bodhi Tree Multimedia's earnings per share have plummeted approximately 99% a year over the previous five years.

The main way most investors will assess a company's dividend prospects is by checking the historical rate of dividend growth. Bodhi Tree Multimedia has seen its dividend decline 50% per annum on average over the past two years, which is not great to see. While it's not great that earnings and dividends per share have fallen in recent years, we're encouraged by the fact that management has trimmed the dividend rather than risk over-committing the company in a risky attempt to maintain yields to shareholders.

The Bottom Line

Has Bodhi Tree Multimedia got what it takes to maintain its dividend payments? Bodhi Tree Multimedia's earnings per share are down over the past five years, although it has the cushion of a low payout ratio, which would suggest a cut to the dividend is relatively unlikely. Overall, Bodhi Tree Multimedia looks like a promising dividend stock in this analysis, and we think it would be worth investigating further.

While it's tempting to invest in Bodhi Tree Multimedia for the dividends alone, you should always be mindful of the risks involved. To help with this, we've discovered 2 warning signs for Bodhi Tree Multimedia that you should be aware of before investing in their shares.

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.