Chugin Financial GroupInc (TSE:5832) Has Announced That It Will Be Increasing Its Dividend To ¥37.00

The board of Chugin Financial Group,Inc. (TSE:5832) has announced that it will be paying its dividend of ¥37.00 on the 9th of December, an increased payment from last year's comparable dividend. This will take the annual payment to 3.9% of the stock price, which is above what most companies in the industry pay.

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Chugin Financial GroupInc's Dividend Forecasted To Be Well Covered By Earnings

A big dividend yield for a few years doesn't mean much if it can't be sustained.

Chugin Financial GroupInc has a long history of paying out dividends, with its current track record at a minimum of 10 years. Based on Chugin Financial GroupInc's last earnings report, the payout ratio is at a decent 45%, meaning that the company is able to pay out its dividend with a bit of room to spare.

The next year is set to see EPS grow by 15.5%. If the dividend continues on this path, the future payout ratio could be 44% by next year, which we think can be pretty sustainable going forward.

View our latest analysis for Chugin Financial GroupInc

Chugin Financial GroupInc Has A Solid Track Record

The company has a sustained record of paying dividends with very little fluctuation. The dividend has gone from an annual total of ¥18.00 in 2015 to the most recent total annual payment of ¥74.00. This means that it has been growing its distributions at 15% per annum over that time. We can see that payments have shown some very nice upward momentum without faltering, which provides some reassurance that future payments will also be reliable.

The Dividend Looks Likely To Grow

Investors who have held shares in the company for the past few years will be happy with the dividend income they have received. Chugin Financial GroupInc has seen EPS rising for the last five years, at 19% per annum. Earnings are on the uptrend, and it is only paying a small portion of those earnings to shareholders.

We Really Like Chugin Financial GroupInc's Dividend

Overall, a dividend increase is always good, and we think that Chugin Financial GroupInc is a strong income stock thanks to its track record and growing earnings. Earnings are easily covering distributions, and the company is generating plenty of cash. Taking this all into consideration, this looks like it could be a good dividend opportunity.

Investors generally tend to favour companies with a consistent, stable dividend policy as opposed to those operating an irregular one. Meanwhile, despite the importance of dividend payments, they are not the only factors our readers should know when assessing a company. Are management backing themselves to deliver performance? Check their shareholdings in Chugin Financial GroupInc in our latest insider ownership analysis. 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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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.