MediPal Holdings Corporation's (TSE:7459) investors are due to receive a payment of ¥30.00 per share on 4th of December. This means that the annual payment will be 2.3% of the current stock price, which is in line with the average for the industry.
View our latest analysis for MediPal Holdings
MediPal Holdings' Earnings Easily Cover The Distributions
Solid dividend yields are great, but they only really help us if the payment is sustainable. Before making this announcement, MediPal Holdings was easily earning enough to cover the dividend. This means that most of its earnings are being retained to grow the business.
The next year is set to see EPS grow by 3.6%. If the dividend continues on this path, the payout ratio could be 33% by next year, which we think can be pretty sustainable going forward.
MediPal Holdings Has A Solid Track Record
Even over a long history of paying dividends, the company's distributions have been remarkably stable. The annual payment during the last 10 years was ¥22.00 in 2014, and the most recent fiscal year payment was ¥60.00. This means that it has been growing its distributions at 11% per annum over that time. It is good to see that there has been strong dividend growth, and that there haven't been any cuts for a long time.
MediPal Holdings May Find It Hard To Grow The Dividend
Some investors will be chomping at the bit to buy some of the company's stock based on its dividend history. Earnings per share has been crawling upwards at 4.2% per year. If MediPal Holdings is struggling to find viable investments, it always has the option to increase its payout ratio to pay more to shareholders.
MediPal Holdings Looks Like A Great Dividend Stock
Overall, we like to see the dividend staying consistent, and we think MediPal Holdings might even raise payments in the future. The company is easily earning enough to cover its dividend payments and it is great to see that these earnings are being translated into cash flow. 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. 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 6 analysts we track are forecasting for MediPal Holdings for free with public analyst estimates for the company. Is MediPal Holdings not quite the opportunity you were looking for? Why not check out 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.
About TSE:7459
MediPal Holdings
Medipal Holdings Corporation engages in the prescription pharmaceutical wholesale business in Japan.
Flawless balance sheet, undervalued and pays a dividend.
