Open House Group's (TSE:3288) Dividend Will Be Increased To ¥84.00

Open House Group Co., Ltd. (TSE:3288) will increase its dividend from last year's comparable payment on the 12th of June to ¥84.00. This makes the dividend yield 3.2%, which is above the industry average.

See our latest analysis for Open House Group

Open House Group's Payment Could Potentially Have Solid Earnings Coverage

A big dividend yield for a few years doesn't mean much if it can't be sustained. However, prior to this announcement, Open House Group's dividend was comfortably covered by both cash flow and earnings. This means that most of its earnings are being retained to grow the business.

The next year is set to see EPS grow by 4.4%. If the dividend continues on this path, the payout ratio could be 24% by next year, which we think can be pretty sustainable going forward.

Open House Group Has A Solid Track Record

The company has a sustained record of paying dividends with very little fluctuation. The annual payment during the last 10 years was ¥7.50 in 2015, and the most recent fiscal year payment was ¥168.00. This means that it has been growing its distributions at 36% per annum over that time. We can see that payments have shown some very nice upward momentum without faltering, which provides some reassurance that future payments will also be reliable.

The Dividend Looks Likely To Grow

Investors could be attracted to the stock based on the quality of its payment history. Open House Group has impressed us by growing EPS at 18% per year over the past five years. With a decent amount of growth and a low payout ratio, we think this bodes well for Open House Group's prospects of growing its dividend payments in the future.

We Really Like Open House Group's Dividend

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

Investors generally tend to favour companies with a consistent, stable dividend policy as opposed to those operating an irregular one. However, there are other things to consider for investors when analysing stock performance. Earnings growth generally bodes well for the future value of company dividend payments. See if the 6 Open House Group analysts we track are forecasting continued growth with our free report on analyst estimates for the company. Is Open House Group not quite the opportunity you were looking for? Why not check out our selection of top dividend stocks.

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