Matrimony.com (NSE:MATRIMONY) Will Pay A Dividend Of ₹5.00

Matrimony.com Limited (NSE:MATRIMONY) has announced that it will pay a dividend of ₹5.00 per share on the 8th of September. This means the annual payment is 0.8% of the current stock price, which is above the average for the industry.

View our latest analysis for Matrimony.com

Matrimony.com's Dividend Is Well Covered By Earnings

While it is great to have a strong dividend yield, we should also consider whether the payment is sustainable. However, Matrimony.com's earnings easily cover the dividend. This means that most of what the business earns is being used to help it grow.

Looking forward, earnings per share is forecast to rise by 52.1% over the next year. If the dividend continues on this path, the payout ratio could be 18% by next year, which we think can be pretty sustainable going forward.

Matrimony.com Doesn't Have A Long Payment History

Matrimony.com's dividend has been pretty stable for a little while now, but we will continue to be cautious until it has been demonstrated for a few more years. Since 2018, the dividend has gone from ₹1.50 total annually to ₹5.00. This works out to be a compound annual growth rate (CAGR) of approximately 22% a year over that time. Matrimony.com has been growing its dividend quite rapidly, which is exciting. However, the short payment history makes us question whether this performance will persist across a full market cycle.

Dividend Growth May Be Hard To Achieve

The company's investors will be pleased to have been receiving dividend income for some time. However, Matrimony.com has only grown its earnings per share at 3.6% per annum over the past five years. If Matrimony.com is struggling to find viable investments, it always has the option to increase its payout ratio to pay more to shareholders.

Our Thoughts On Matrimony.com's Dividend

In summary, we are pleased with the dividend remaining consistent, and we think there is a good chance of this continuing in the future. The payout ratio looks good, but unfortunately the company's dividend track record isn't stellar. Taking all of this into consideration, the dividend looks viable moving forward, but investors should be mindful that the company has pushed the boundaries of sustainability in the past and may do so again.

Market movements attest to how highly valued a consistent dividend policy is compared to one which is more unpredictable. At the same time, there are other factors our readers should be conscious of before pouring capital into a stock. As an example, we've identified 1 warning sign for Matrimony.com that you should be aware of before investing. If you are a dividend investor, you might also want to look at our curated list of high yield dividend stocks.

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