Sugi Holdings Co.,Ltd.'s (TSE:7649) investors are due to receive a payment of ¥40.00 per share on 31st of May. This payment means the dividend yield will be 1.1%, which is below the average for the industry.
See our latest analysis for Sugi HoldingsLtd
Sugi HoldingsLtd's Payment Has Solid Earnings Coverage
Even a low dividend yield can be attractive if it is sustained for years on end. However, Sugi HoldingsLtd'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 14.1%. Assuming the dividend continues along recent trends, we think the payout ratio could be 22% by next year, which is in a pretty sustainable range.
Sugi HoldingsLtd Has A Solid Track Record
The company has an extended history of paying stable dividends. Since 2014, the annual payment back then was ¥32.00, compared to the most recent full-year payment of ¥80.00. This means that it has been growing its distributions at 9.6% per annum over that time. The dividend has been growing very nicely for a number of years, and has given its shareholders some nice income in their portfolios.
Sugi HoldingsLtd 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. We are encouraged to see that Sugi HoldingsLtd has grown earnings per share at 5.9% per year over the past five years. With a decent amount of growth and a low payout ratio, we think this bodes well for Sugi HoldingsLtd's prospects of growing its dividend payments in the future.
Sugi HoldingsLtd Looks Like A Great Dividend Stock
Overall, we think that this is a great income investment, and we think that maintaining the dividend this year may have been a conservative choice. 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.
Investors generally tend to favour companies with a consistent, stable dividend policy as opposed to those operating an irregular one. At the same time, there are other factors our readers should be conscious of before pouring capital into a stock. Companies that are growing earnings tend to be the best dividend stocks over the long term. See what the 9 analysts we track are forecasting for Sugi HoldingsLtd for free with public analyst estimates for the company. 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.
About TSE:7649
Solid track record with excellent balance sheet and pays a dividend.
