MINEBEA MITSUMI Inc.'s (TSE:6479) investors are due to receive a payment of ¥20.00 per share on 29th of November. This means the annual payment will be 1.1% of the current stock price, which is lower than the industry average.
View our latest analysis for MINEBEA MITSUMI
MINEBEA MITSUMI's Earnings Easily Cover The Distributions
Even a low dividend yield can be attractive if it is sustained for years on end. However, MINEBEA MITSUMI's earnings easily cover the dividend. As a result, a large proportion of what it earned was being reinvested back into the business.
Over the next year, EPS is forecast to expand by 2.1%. If the dividend continues along recent trends, we estimate the payout ratio will be 33%, which is in the range that makes us comfortable with the sustainability of the dividend.
Dividend Volatility
The company's dividend history has been marked by instability, with at least one cut in the last 10 years. The annual payment during the last 10 years was ¥8.00 in 2014, and the most recent fiscal year payment was ¥40.00. This means that it has been growing its distributions at 17% per annum over that time. MINEBEA MITSUMI has grown distributions at a rapid rate despite cutting the dividend at least once in the past. Companies that cut once often cut again, so we would be cautious about buying this stock solely for the dividend income.
The Dividend's Growth Prospects Are Limited
With a relatively unstable dividend, it's even more important to see if earnings per share is growing. MINEBEA MITSUMI hasn't seen much change in its earnings per share over the last five years.
In Summary
Overall, we don't think this company makes a great dividend stock, even though the dividend wasn't cut this year. The payments haven't been particularly stable and we don't see huge growth potential, but with the dividend well covered by cash flows it could prove to be reliable over the short term. We don't think MINEBEA MITSUMI is a great stock to add to your portfolio if income is your focus.
Market movements attest to how highly valued a consistent dividend policy is compared to one which is more unpredictable. However, there are other things to consider for investors when analysing stock performance. For instance, we've picked out 1 warning sign for MINEBEA MITSUMI that investors should take into consideration. 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.
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About TSE:6479
MINEBEA MITSUMI
Manufactures and supplies machined components, electronic devices and components, automotive, and industrial machinery and home security business in Japan and internationally.
Excellent balance sheet second-rate dividend payer.
