The board of en-japan inc. (TSE:4849) has announced that it will pay a dividend on the 27th of June, with investors receiving ¥70.10 per share. The dividend yield will be 3.4% based on this payment which is still above the industry average.
View our latest analysis for en-japan
en-japan's Projected Earnings Seem Likely To Cover Future Distributions
We like to see robust dividend yields, but that doesn't matter if the payment isn't sustainable. However, en-japan's earnings easily cover the dividend. This means that most of what the business earns is being used to help it grow.
Looking forward, earnings per share is forecast to rise by 0.5% over the next year. If the dividend continues along recent trends, we estimate the payout ratio will be 38%, which is in the range that makes us comfortable with the sustainability of the dividend.
en-japan Has A Solid Track Record
The company has been paying a dividend for a long time, and it has been quite stable which gives us confidence in the future dividend potential. The dividend has gone from an annual total of ¥14.25 in 2015 to the most recent total annual payment of ¥70.10. This implies that the company grew its distributions at a yearly rate of about 17% over that duration. It is good to see that there has been strong dividend growth, and that there haven't been any cuts for a long time.
en-japan Could Grow Its Dividend
The company's investors will be pleased to have been receiving dividend income for some time. en-japan has seen EPS rising for the last five years, at 5.3% per annum. With a decent amount of growth and a low payout ratio, we think this bodes well for en-japan's prospects of growing its dividend payments in the future.
We Really Like en-japan's Dividend
Overall, we like to see the dividend staying consistent, and we think en-japan might even raise payments in the future. Distributions are quite easily covered by earnings, which are also being converted to cash flows. Taking this all into consideration, this looks like it could be a good dividend opportunity.
Market movements attest to how highly valued a consistent dividend policy is compared to one which is more unpredictable. 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 en-japan that investors should know about before committing capital to this stock. Is en-japan 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.
About TSE:4849
Flawless balance sheet, undervalued and pays a dividend.
