Is It Smart To Buy Marusan Securities Co., Ltd. (TSE:8613) Before It Goes Ex-Dividend?

Readers hoping to buy Marusan Securities Co., Ltd. (TSE:8613) for its dividend will need to make their move shortly, as the stock is about to trade ex-dividend. Typically, the ex-dividend date is one business day before the record date which is the date on which a company determines the shareholders eligible to receive a dividend. It is important to be aware of the ex-dividend date because any trade on the stock needs to have been settled on or before the record date. In other words, investors can purchase Marusan Securities' shares before the 27th of September in order to be eligible for the dividend, which will be 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, Marusan Securities stock has a trailing yield of around 6.1% on the current share price of JP¥988.00. If you buy this business for its dividend, you should have an idea of whether Marusan Securities's dividend is reliable and sustainable. As a result, readers should always check whether Marusan Securities has been able to grow its dividends, or if the dividend might be cut.

Check out our latest analysis for Marusan Securities

If a company pays out more in dividends than it earned, then the dividend might become unsustainable - hardly an ideal situation. Marusan Securities is paying out an acceptable 64% of its profit, a common payout level among most companies.

When a company paid out less in dividends than it earned in profit, this generally suggests its dividend is affordable. The lower the % of its profit that it pays out, the greater the margin of safety for the dividend if the business enters a downturn.

Click here to see how much of its profit Marusan Securities 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 earnings decline and the company is forced to cut its dividend, investors could watch the value of their investment go up in smoke. It's encouraging to see Marusan Securities has grown its earnings rapidly, up 43% a year for the past five years.

Another key way to measure a company's dividend prospects is by measuring its historical rate of dividend growth. Marusan Securities's dividend payments are effectively flat on where they were 10 years ago.

The Bottom Line

Has Marusan Securities got what it takes to maintain its dividend payments? Earnings per share are growing nicely, and Marusan Securities is paying out a percentage of its earnings that is around the average for dividend-paying stocks. In summary, Marusan Securities appears to have some promise as a dividend stock, and we'd suggest taking a closer look at it.

With that in mind, a critical part of thorough stock research is being aware of any risks that stock currently faces. To help with this, we've discovered 1 warning sign for Marusan Securities that you should be aware of before investing in their shares.

A common investing mistake is buying the first interesting stock you see. Here you can find a full list of high-yield 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.