Fuji Seal International (TSE:7864) Has Announced A Dividend Of ¥35.00

Fuji Seal International, Inc. (TSE:7864) has announced that it will pay a dividend of ¥35.00 per share on the 2nd of December. This takes the annual payment to 2.4% of the current stock price, which is about average for the industry.

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Fuji Seal International's Future Dividend Projections Appear Well Covered By Earnings

While it is always good to see a solid dividend yield, we should also consider whether the payment is feasible. However, prior to this announcement, Fuji Seal International's dividend was comfortably covered by both cash flow and earnings. This means that most of what the business earns is being used to help it grow.

Over the next year, EPS is forecast to expand by 3.9%. Assuming the dividend continues along recent trends, we think the payout ratio could be 32% by next year, which is in a pretty sustainable range.

Check out our latest analysis for Fuji Seal International

Fuji Seal International Has A Solid Track Record

The company has a sustained record of paying dividends with very little fluctuation. Since 2015, the annual payment back then was ¥21.00, compared to the most recent full-year payment of ¥71.00. This means that it has been growing its distributions at 13% per annum over that time. So, dividends have been growing pretty quickly, and even more impressively, they haven't experienced any notable falls during this period.

The Dividend Looks Likely To Grow

Investors who have held shares in the company for the past few years will be happy with the dividend income they have received. Fuji Seal International has impressed us by growing EPS at 13% per year over the past five years. Fuji Seal International definitely has the potential to grow its dividend in the future with earnings on an uptrend and a low payout ratio.

Fuji Seal International 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. 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.

It's important to note that companies having a consistent dividend policy will generate greater investor confidence than those having an erratic one. Still, investors need to consider a host of other factors, apart from dividend payments, when analysing a company. Companies that are growing earnings tend to be the best dividend stocks over the long term. See what the 3 analysts we track are forecasting for Fuji Seal International for free with public analyst estimates for the company. Is Fuji Seal International not quite the opportunity you were looking for? Why not check out our selection of top dividend stocks.

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