SIGMAXYZ Holdings' (TSE:6088) Shareholders Will Receive A Bigger Dividend Than Last Year

SIGMAXYZ Holdings Inc.'s (TSE:6088) dividend will be increasing from last year's payment of the same period to ¥26.00 on 8th of June. This takes the dividend yield to 3.2%, which shareholders will be pleased with.

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SIGMAXYZ Holdings' Future Dividend Projections Appear Well Covered By Earnings

Impressive dividend yields are good, but this doesn't matter much if the payments can't be sustained. Based on the last payment, SIGMAXYZ Holdings was quite comfortably earning enough to cover the dividend. This indicates that quite a large proportion of earnings is being invested back into the business.

Over the next year, EPS is forecast to expand by 19.0%. Assuming the dividend continues along recent trends, we think the payout ratio could be 50% by next year, which is in a pretty sustainable range.

See our latest analysis for SIGMAXYZ Holdings

SIGMAXYZ Holdings Has A Solid Track Record

Even over a long history of paying dividends, the company's distributions have been remarkably stable. The annual payment during the last 10 years was ¥3.00 in 2015, and the most recent fiscal year payment was ¥26.00. This implies that the company grew its distributions at a yearly rate of about 24% over that duration. Rapidly growing dividends for a long time is a very valuable feature for an income stock.

The Dividend Looks Likely To Grow

Some investors will be chomping at the bit to buy some of the company's stock based on its dividend history. SIGMAXYZ Holdings has seen EPS rising for the last five years, at 28% per annum. SIGMAXYZ Holdings is clearly able to grow rapidly while still returning cash to shareholders, positioning it to become a strong dividend payer in the future.

SIGMAXYZ Holdings Looks Like A Great Dividend Stock

Overall, a dividend increase is always good, and we think that SIGMAXYZ Holdings is a strong income stock thanks to its track record and growing earnings. The company is easily earning enough to cover its dividend payments and it is great to see that these earnings are being translated into cash flow. All of these factors considered, we think this has solid potential as a dividend stock.

It's important to note that companies having a consistent dividend policy will generate greater investor confidence than those having an erratic one. However, there are other things to consider for investors when analysing stock performance. As an example, we've identified 1 warning sign for SIGMAXYZ Holdings that you should be aware of before investing. Is SIGMAXYZ 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.