Nihon M&A Center Holdings (TSE:2127) Will Pay A Larger Dividend Than Last Year At ¥15.00

Nihon M&A Center Holdings Inc.'s (TSE:2127) dividend will be increasing from last year's payment of the same period to ¥15.00 on 26th of June. This takes the dividend yield to 3.5%, which shareholders will be pleased with.

View our latest analysis for Nihon M&A Center Holdings

Nihon M&A Center Holdings' Future Dividend Projections Appear Well Covered By Earnings

A big dividend yield for a few years doesn't mean much if it can't be sustained. The last dividend was quite easily covered by Nihon M&A Center Holdings' earnings. This indicates that quite a large proportion of earnings is being invested back into the business.

EPS is set to grow by 8.4% over the next year. If recent patterns in the dividend continues, the payout ratio in 12 months could be 91% which is a bit high but can definitely be sustainable.

Nihon M&A Center 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. Since 2015, the annual payment back then was ¥3.33, compared to the most recent full-year payment of ¥23.00. This implies that the company grew its distributions at a yearly rate of about 21% over that duration. So, dividends have been growing pretty quickly, and even more impressively, they haven't experienced any notable falls during this period.

Nihon M&A Center Holdings May Find It Hard To Grow The Dividend

The company's investors will be pleased to have been receiving dividend income for some time. However, Nihon M&A Center Holdings' EPS was effectively flat over the past five years, which could stop the company from paying more every year. Growth of 1.5% may indicate that the company has limited investment opportunity so it is returning its earnings to shareholders instead. This could mean the dividend doesn't have the growth potential we look for going into the future.

We Really Like Nihon M&A Center Holdings' Dividend

In summary, it is always positive to see the dividend being increased, and we are particularly pleased with its overall sustainability. 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. Still, investors need to consider a host of other factors, apart from dividend payments, when analysing a company. Earnings growth generally bodes well for the future value of company dividend payments. See if the 5 Nihon M&A Center Holdings analysts we track are forecasting continued growth with our free report on analyst estimates for the company. Looking for more high-yielding dividend ideas? Try our collection of strong dividend payers.

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