Yokogawa Bridge Holdings' (TSE:5911) Dividend Will Be ¥55.00

Yokogawa Bridge Holdings Corp.'s (TSE:5911) investors are due to receive a payment of ¥55.00 per share on 27th of June. This takes the dividend yield to 3.9%, which shareholders will be pleased with.

See our latest analysis for Yokogawa Bridge Holdings

Yokogawa Bridge Holdings' Projected Earnings Seem Likely To Cover Future Distributions

Impressive dividend yields are good, but this doesn't matter much if the payments can't be sustained. Based on the last payment, Yokogawa Bridge Holdings' earnings were much higher than the dividend, but it wasn't converting those earnings into cash flow. No cash flows could definitely make returning cash to shareholders difficult, or at least mean the balance sheet will come under pressure.

Over the next year, EPS is forecast to expand by 14.7%. If the dividend continues on this path, the payout ratio could be 50% by next year, which we think can be pretty sustainable going forward.

Yokogawa Bridge Holdings Has A Solid Track Record

The company has an extended history of paying stable dividends. Since 2014, the annual payment back then was ¥12.00, compared to the most recent full-year payment of ¥110.00. This means that it has been growing its distributions at 25% per annum over that time. So, dividends have been growing pretty quickly, and even more impressively, they haven't experienced any notable falls during this period.

We Could See Yokogawa Bridge Holdings' Dividend Growing

Investors who have held shares in the company for the past few years will be happy with the dividend income they have received. Yokogawa Bridge Holdings has seen EPS rising for the last five years, at 5.5% per annum. While on an earnings basis, this company looks appealing as an income stock, the cash payout ratio still makes us cautious.

Our Thoughts On Yokogawa Bridge Holdings' Dividend

In summary, while it's always good to see the dividend being raised, we don't think Yokogawa Bridge Holdings' payments are rock solid. While the low payout ratio is a redeeming feature, this is offset by the minimal cash to cover the payments. This company is not in the top tier of income providing stocks.

Investors generally tend to favour companies with a consistent, stable dividend policy as opposed to those operating an irregular one. Still, investors need to consider a host of other factors, apart from dividend payments, when analysing a company. For instance, we've picked out 1 warning sign for Yokogawa Bridge Holdings that investors should take into consideration. Is Yokogawa Bridge Holdings 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.