San ju San Financial GroupInc's (TSE:7322) Upcoming Dividend Will Be Larger Than Last Year's

San ju San Financial Group,Inc. (TSE:7322) has announced that it will be increasing its dividend from last year's comparable payment on the 8th of December to ¥64.00. Based on this payment, the dividend yield for the company will be 3.8%, which is fairly typical for the industry.

While the dividend yield is important for income investors, it is also important to consider any large share price moves, as this will generally outweigh any gains from distributions. Investors will be pleased to see that San ju San Financial GroupInc's stock price has increased by 51% in the last 3 months, which is good for shareholders and can also explain a decrease in the dividend yield.

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

We like to see a healthy dividend yield, but that is only helpful to us if the payment can continue.

San ju San Financial GroupInc has a good history of paying out dividends, with its current track record at 7 years. While past records don't necessarily translate into future results, the company's payout ratio of 15% also shows that San ju San Financial GroupInc is able to comfortably pay dividends.

Over the next year, EPS could expand by 17.8% if recent trends continue. If the dividend continues along recent trends, we estimate the future payout ratio will be 32%, which is in the range that makes us comfortable with the sustainability of the dividend.

See our latest analysis for San ju San Financial GroupInc

San ju San Financial GroupInc Is Still Building Its Track Record

The dividend's track record has been pretty solid, but with only 7 years of history we want to see a few more years of history before making any solid conclusions. The dividend has gone from an annual total of ¥72.00 in 2018 to the most recent total annual payment of ¥128.00. This works out to be a compound annual growth rate (CAGR) of approximately 8.6% a year over that time. San ju San Financial GroupInc has a nice track record of dividend growth but we would wait until we see a longer track record before getting too confident.

The Dividend Looks Likely To Grow

The company's investors will be pleased to have been receiving dividend income for some time. San ju San Financial GroupInc has seen EPS rising for the last five years, at 18% per annum. A low payout ratio and decent growth suggests that the company is reinvesting well, and it also has plenty of room to increase the dividend over time.

We Really Like San ju San Financial GroupInc's Dividend

In summary, it is always positive to see the dividend being increased, and we are particularly pleased with its overall sustainability. 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.

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. For example, we've picked out 1 warning sign for San ju San Financial GroupInc that investors should know about before committing capital to this stock. Is San ju San Financial GroupInc not quite the opportunity you were looking for? Why not check out 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.