Nomura Research Institute (TSE:4307) Will Pay A Larger Dividend Than Last Year At ¥34.00

Nomura Research Institute, Ltd. (TSE:4307) will increase its dividend from last year's comparable payment on the 2nd of June to ¥34.00. The payment will take the dividend yield to 1.4%, which is in line with the average for the industry.

See our latest analysis for Nomura Research Institute

Nomura Research Institute's Future Dividend Projections Appear Well Covered By Earnings

We like to see a healthy dividend yield, but that is only helpful to us if the payment can continue. Before making this announcement, Nomura Research Institute was easily earning enough to cover the dividend. As a result, a large proportion of what it earned was being reinvested back into the business.

The next year is set to see EPS grow by 8.5%. Assuming the dividend continues along recent trends, we think the payout ratio could be 41% by next year, which is in a pretty sustainable range.

Nomura Research Institute Has A Solid Track Record

The company has an extended history of paying stable dividends. Since 2015, the dividend has gone from ¥16.53 total annually to ¥68.00. This works out to be a compound annual growth rate (CAGR) of approximately 15% a year over that time. So, dividends have been growing pretty quickly, and even more impressively, they haven't experienced any notable falls during this period.

We Could See Nomura Research Institute's Dividend Growing

Some investors will be chomping at the bit to buy some of the company's stock based on its dividend history. It's encouraging to see that Nomura Research Institute has been growing its earnings per share at 9.4% a year over the past five years. Nomura Research Institute definitely has the potential to grow its dividend in the future with earnings on an uptrend and a low payout ratio.

Nomura Research Institute Looks Like A Great Dividend Stock

Overall, a dividend increase is always good, and we think that Nomura Research Institute is a strong income stock thanks to its track record and growing earnings. Distributions are quite easily covered by earnings, which are also being converted to cash flows. Taking this all into consideration, this looks like it could be a good dividend opportunity.

Companies possessing a stable dividend policy will likely enjoy greater investor interest than those suffering from a more inconsistent approach. However, there are other things to consider for investors when analysing stock performance. Earnings growth generally bodes well for the future value of company dividend payments. See if the 12 Nomura Research Institute analysts we track are forecasting continued growth with our free report on analyst estimates for the company. If you are a dividend investor, you might also want to look at our curated list of high yield 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.