Concordia Financial Group (TSE:7186) Has Announced That It Will Be Increasing Its Dividend To ¥14.00

Concordia Financial Group, Ltd.'s (TSE:7186) dividend will be increasing from last year's payment of the same period to ¥14.00 on 29th of May. This makes the dividend yield about the same as the industry average at 3.1%.

See our latest analysis for Concordia Financial Group

Concordia Financial Group's Earnings Will Easily Cover The Distributions

We like a dividend to be consistent over the long term, so checking whether it is sustainable is important.

Having paid out dividends for 9 years, Concordia Financial Group has a good history of paying out a part of its earnings to shareholders. Based on Concordia Financial Group's last earnings report, the payout ratio is at a decent 38%, 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 12.2%. If the dividend continues along recent trends, we estimate the future payout ratio will be 39%, which is in the range that makes us comfortable with the sustainability of the dividend.

Concordia Financial Group Doesn't Have A Long Payment History

The dividend's track record has been pretty solid, but with only 9 years of history we want to see a few more years of history before making any solid conclusions. Since 2016, the dividend has gone from ¥13.00 total annually to ¥27.00. This means that it has been growing its distributions at 8.5% per annum over that time. The dividend has been growing as a reasonable rate, which we like. However, investors will probably want to see a longer track record before they consider Concordia Financial Group to be a consistent dividend paying stock.

The Dividend Looks Likely To Grow

The company's investors will be pleased to have been receiving dividend income for some time. We are encouraged to see that Concordia Financial Group has grown earnings per share at 11% per year over the past five years. With a decent amount of growth and a low payout ratio, we think this bodes well for Concordia Financial Group's prospects of growing its dividend payments in the future.

We Really Like Concordia Financial Group's Dividend

Overall, a dividend increase is always good, and we think that Concordia Financial Group is a strong income stock thanks to its track record and growing earnings. Distributions are quite easily covered by earnings, which are also being converted to cash flows. All of these factors considered, we think this has solid potential as a dividend stock.

Companies possessing a stable dividend policy will likely enjoy greater investor interest than those suffering from a more inconsistent approach. At the same time, there are other factors our readers should be conscious of before pouring capital into a stock. Earnings growth generally bodes well for the future value of company dividend payments. See if the 7 Concordia Financial Group analysts we track are forecasting continued growth with our free report on analyst estimates for the company. Looking for more high-yielding dividend ideas? Try our collection of 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.