Kyokuyo (TSE:1301) Is Paying Out A Dividend Of ¥100.00

The board of Kyokuyo Co., Ltd. (TSE:1301) has announced that it will pay a dividend on the 28th of June, with investors receiving ¥100.00 per share. The dividend yield will be 2.5% based on this payment which is still above the industry average.

See our latest analysis for Kyokuyo

Kyokuyo's Earnings Easily Cover The Distributions

A big dividend yield for a few years doesn't mean much if it can't be sustained. Before making this announcement, Kyokuyo was easily earning enough to cover the dividend. This means that most of what the business earns is being used to help it grow.

Over the next year, EPS could expand by 8.6% if recent trends continue. Assuming the dividend continues along recent trends, we think the payout ratio could be 24% by next year, which is in a pretty sustainable range.

Kyokuyo Has A Solid Track Record

The company has an extended history of paying stable dividends. The dividend has gone from an annual total of ¥50.00 in 2014 to the most recent total annual payment of ¥90.00. This means that it has been growing its distributions at 6.1% 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.

We Could See Kyokuyo's Dividend Growing

Some investors will be chomping at the bit to buy some of the company's stock based on its dividend history. We are encouraged to see that Kyokuyo has grown earnings per share at 8.6% per year over the past five years. Kyokuyo definitely has the potential to grow its dividend in the future with earnings on an uptrend and a low payout ratio.

Kyokuyo Looks Like A Great Dividend Stock

Overall, we like to see the dividend staying consistent, and we think Kyokuyo might even raise payments in the future. Distributions are quite easily covered by earnings, which are also being converted to cash flows. All of these factors considered, we think this has solid potential as a dividend stock.

Market movements attest to how highly valued a consistent dividend policy is compared to one which is more unpredictable. Meanwhile, despite the importance of dividend payments, they are not the only factors our readers should know when assessing a company. Just as an example, we've come across 2 warning signs for Kyokuyo you should be aware of, and 1 of them doesn't sit too well with us. 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.