KomeriLtd (TSE:8218) Has Announced A Dividend Of ¥26.00

Komeri Co.,Ltd. (TSE:8218) will pay a dividend of ¥26.00 on the 26th of June. Based on this payment, the dividend yield for the company will be 1.4%, which is fairly typical for the industry.

Check out our latest analysis for KomeriLtd

KomeriLtd's Earnings Easily Cover The Distributions

We like to see a healthy dividend yield, but that is only helpful to us if the payment can continue. However, prior to this announcement, KomeriLtd'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.

Looking forward, earnings per share is forecast to rise by 5.9% over the next year. If the dividend continues on this path, the payout ratio could be 17% by next year, which we think can be pretty sustainable going forward.

KomeriLtd Has A Solid Track Record

Even over a long history of paying dividends, the company's distributions have been remarkably stable. Since 2014, the annual payment back then was ¥36.00, compared to the most recent full-year payment of ¥52.00. This implies that the company grew its distributions at a yearly rate of about 3.7% over that duration. Dividends have grown relatively slowly, which is not great, but some investors may value the relative consistency of the dividend.

We Could See KomeriLtd's Dividend Growing

Some investors will be chomping at the bit to buy some of the company's stock based on its dividend history. KomeriLtd has seen EPS rising for the last five years, at 5.2% per annum. With a decent amount of growth and a low payout ratio, we think this bodes well for KomeriLtd's prospects of growing its dividend payments in the future.

KomeriLtd 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. Earnings are easily covering distributions, and the company is generating plenty of cash. All in all, this checks a lot of the boxes we look for when choosing an income 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. Earnings growth generally bodes well for the future value of company dividend payments. See if the 4 KomeriLtd analysts we track are forecasting continued growth with our free report on analyst estimates for the company. Is KomeriLtd 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.