Create SD Holdings (TSE:3148) Is Due To Pay A Dividend Of ¥27.00

The board of Create SD Holdings Co., Ltd. (TSE:3148) has announced that it will pay a dividend of ¥27.00 per share on the 28th of August. This means that the annual payment will be 1.7% of the current stock price, which is in line with the average for the industry.

Check out our latest analysis for Create SD Holdings

Create SD Holdings' Earnings Easily Cover The Distributions

While it is always good to see a solid dividend yield, we should also consider whether the payment is feasible. However, Create SD Holdings' 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 could expand by 6.2% if recent trends continue. Assuming the dividend continues along recent trends, we think the payout ratio could be 26% by next year, which is in a pretty sustainable range.

Create SD Holdings 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 ¥19.33 in 2014 to the most recent total annual payment of ¥54.00. This works out to be a compound annual growth rate (CAGR) of approximately 11% a year 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.

Create SD Holdings Could Grow Its Dividend

Investors who have held shares in the company for the past few years will be happy with the dividend income they have received. Create SD Holdings has seen EPS rising for the last five years, at 6.2% per annum. With a decent amount of growth and a low payout ratio, we think this bodes well for Create SD Holdings' prospects of growing its dividend payments in the future.

Create SD Holdings Looks Like A Great Dividend Stock

In summary, it is good to see that the dividend is staying consistent, and we don't think there is any reason to suspect this might change over the medium term. Earnings are easily covering distributions, and the company is generating plenty of cash. All of these factors considered, we think this has solid potential as a dividend stock.

Companies possessing a stable dividend policy will likely enjoy greater investor interest than those suffering from a more inconsistent approach. However, there are other things to consider for investors when analysing stock performance. Now, if you want to look closer, it would be worth checking out our free research on Create SD Holdings management tenure, salary, and performance. 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.