Here's What We Like About Gamecard-Joyco HoldingsInc's (TSE:6249) Upcoming Dividend

It looks like Gamecard-Joyco Holdings,Inc. (TSE:6249) is about to go ex-dividend in the next 3 days. The ex-dividend date is one business day before the record date, which is the cut-off date for shareholders to be present on the company's books to be eligible for a dividend payment. The ex-dividend date is of consequence because whenever a stock is bought or sold, the trade takes at least two business day to settle. Therefore, if you purchase Gamecard-Joyco HoldingsInc's shares on or after the 27th of September, you won't be eligible to receive the dividend, when it is paid on the 2nd of December.

The company's next dividend payment will be JP¥30.00 per share, on the back of last year when the company paid a total of JP¥60.00 to shareholders. Based on the last year's worth of payments, Gamecard-Joyco HoldingsInc stock has a trailing yield of around 2.7% on the current share price of JP¥2218.00. Dividends are a major contributor to investment returns for long term holders, but only if the dividend continues to be paid. So we need to check whether the dividend payments are covered, and if earnings are growing.

See our latest analysis for Gamecard-Joyco HoldingsInc

Dividends are usually paid out of company profits, so if a company pays out more than it earned then its dividend is usually at greater risk of being cut. Gamecard-Joyco HoldingsInc paid out just 9.9% of its profit last year, which we think is conservatively low and leaves plenty of margin for unexpected circumstances. A useful secondary check can be to evaluate whether Gamecard-Joyco HoldingsInc generated enough free cash flow to afford its dividend. What's good is that dividends were well covered by free cash flow, with the company paying out 9.7% of its cash flow last year.

It's encouraging to see that the dividend is covered by both profit and cash flow. This generally suggests the dividend is sustainable, as long as earnings don't drop precipitously.

Click here to see how much of its profit Gamecard-Joyco HoldingsInc paid out over the last 12 months.

Have Earnings And Dividends Been Growing?

Companies with consistently growing earnings per share generally make the best dividend stocks, as they usually find it easier to grow dividends per share. If business enters a downturn and the dividend is cut, the company could see its value fall precipitously. It's encouraging to see Gamecard-Joyco HoldingsInc has grown its earnings rapidly, up 40% a year for the past five years. Gamecard-Joyco HoldingsInc earnings per share have been sprinting ahead like the Road Runner at a track and field day; scarcely stopping even for a cheeky "beep-beep". We also like that it is reinvesting most of its profits in its business.'

Another key way to measure a company's dividend prospects is by measuring its historical rate of dividend growth. It looks like the Gamecard-Joyco HoldingsInc dividends are largely the same as they were 10 years ago.

To Sum It Up

From a dividend perspective, should investors buy or avoid Gamecard-Joyco HoldingsInc? Gamecard-Joyco HoldingsInc has grown its earnings per share while simultaneously reinvesting in the business. Unfortunately it's cut the dividend at least once in the past 10 years, but the conservative payout ratio makes the current dividend look sustainable. Gamecard-Joyco HoldingsInc looks solid on this analysis overall, and we'd definitely consider investigating it more closely.

On that note, you'll want to research what risks Gamecard-Joyco HoldingsInc is facing. To help with this, we've discovered 3 warning signs for Gamecard-Joyco HoldingsInc that you should be aware of before investing in their shares.

If you're in the market for strong dividend payers, we recommend checking 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.