i Cubed Systems (TSE:4495) Has Affirmed Its Dividend Of ¥32.00

The board of i Cubed Systems, Inc. (TSE:4495) has announced that it will pay a dividend on the 26th of September, with investors receiving ¥32.00 per share. This makes the dividend yield 2.2%, which will augment investor returns quite nicely.

See our latest analysis for i Cubed Systems

i Cubed Systems' Payment Could Potentially Have Solid Earnings Coverage

We like to see robust dividend yields, but that doesn't matter if the payment isn't sustainable. Before making this announcement, i Cubed Systems 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.

Over the next year, EPS could expand by 2.9% if recent trends continue. Assuming the dividend continues along recent trends, we think the payout ratio could be 39% by next year, which is in a pretty sustainable range.

i Cubed Systems Is Still Building Its Track Record

The company has maintained a consistent dividend for a few years now, but we would like to see a longer track record before relying on it. The dividend has gone from an annual total of ¥10.00 in 2021 to the most recent total annual payment of ¥32.00. This means that it has been growing its distributions at 34% per annum over that time. We're not overly excited about the relatively short history of dividend payments, however the dividend is growing at a nice rate and we might take a closer look.

Dividend Growth May Be Hard To Achieve

Investors could be attracted to the stock based on the quality of its payment history. Earnings per share has been crawling upwards at 2.9% per year. While EPS growth is quite low, i Cubed Systems has the option to increase the payout ratio to return more cash to shareholders.

Our Thoughts On i Cubed Systems' Dividend

Overall, a consistent dividend is a good thing, and we think that i Cubed Systems has the ability to continue this into the future. The payout ratio looks good, but unfortunately the company's dividend track record isn't stellar. The payment isn't stellar, but it could make a decent addition to a dividend portfolio.

Investors generally tend to favour companies with a consistent, stable dividend policy as opposed to those operating an irregular one. Still, investors need to consider a host of other factors, apart from dividend payments, when analysing a company. For example, we've picked out 1 warning sign for i Cubed Systems that investors should know about before committing capital to this stock. Looking for more high-yielding dividend ideas? Try our collection of strong dividend payers.

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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.