Taiheiyo Cement (TSE:5233) Will Pay A Dividend Of ¥50.00

Taiheiyo Cement Corporation's (TSE:5233) investors are due to receive a payment of ¥50.00 per share on 30th of June. The payment will take the dividend yield to 2.7%, which is in line with the average for the industry.

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Taiheiyo Cement's Payment Could Potentially Have Solid Earnings Coverage

Unless the payments are sustainable, the dividend yield doesn't mean too much. However, Taiheiyo Cement's earnings easily cover the dividend. This means that most of its earnings are being retained to grow the business.

Over the next year, EPS is forecast to expand by 8.4%. Assuming the dividend continues along recent trends, we think the payout ratio could be 21% by next year, which is in a pretty sustainable range.

Check out our latest analysis for Taiheiyo Cement

Taiheiyo Cement Has A Solid Track Record

The company has an extended history of paying stable dividends. Since 2015, the annual payment back then was ¥60.00, compared to the most recent full-year payment of ¥100.00. This means that it has been growing its distributions at 5.2% per annum over that time. Companies like this can be very valuable over the long term, if the decent rate of growth can be maintained.

We Could See Taiheiyo Cement's Dividend Growing

Investors who have held shares in the company for the past few years will be happy with the dividend income they have received. Taiheiyo Cement has impressed us by growing EPS at 6.4% per year over the past five years. A low payout ratio and decent growth suggests that the company is reinvesting well, and it also has plenty of room to increase the dividend over time.

Taiheiyo Cement Looks Like A Great Dividend Stock

In summary, it is always positive to see the dividend being increased, and we are particularly pleased with its overall sustainability. 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. However, there are other things to consider for investors when analysing stock performance. For example, we've picked out 1 warning sign for Taiheiyo Cement that investors should know about before committing capital to this stock. Is Taiheiyo Cement not quite the opportunity you were looking for? Why not check out our selection of top dividend stocks.

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