Computer Engineering & Consulting's (TSE:9692) Upcoming Dividend Will Be Larger Than Last Year's

Computer Engineering & Consulting Ltd. (TSE:9692) will increase its dividend from last year's comparable payment on the 23rd of April to ¥35.00. This will take the annual payment to 2.8% of the stock price, which is above what most companies in the industry pay.

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Computer Engineering & Consulting's Projected Earnings Seem Likely To Cover Future Distributions

If the payments aren't sustainable, a high yield for a few years won't matter that much. Based on the last payment, Computer Engineering & Consulting was quite comfortably earning enough to cover the dividend. This indicates that a lot of the earnings are being reinvested into the business, with the aim of fueling growth.

Looking forward, earnings per share is forecast to rise by 16.1% over the next year. If the dividend continues on this path, the payout ratio could be 48% by next year, which we think can be pretty sustainable going forward.

Check out our latest analysis for Computer Engineering & Consulting

Computer Engineering & Consulting Has A Solid Track Record

The company has a sustained record of paying dividends with very little fluctuation. The dividend has gone from an annual total of ¥10.00 in 2015 to the most recent total annual payment of ¥65.00. This means that it has been growing its distributions at 21% per annum over that time. Rapidly growing dividends for a long time is a very valuable feature for an income stock.

The Dividend's Growth Prospects Are Limited

The company's investors will be pleased to have been receiving dividend income for some time. Earnings has been rising at 3.4% per annum over the last five years, which admittedly is a bit slow. Growth of 3.4% may indicate that the company has limited investment opportunity so it is returning its earnings to shareholders instead. This isn't necessarily bad, but we wouldn't expect rapid dividend growth in the future.

We Really Like Computer Engineering & Consulting's Dividend

Overall, we think this could be an attractive income stock, and it is only getting better by paying a higher dividend this year. 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.

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. You can also discover whether shareholders are aligned with insider interests by checking our visualisation of insider shareholdings and trades in Computer Engineering & Consulting stock. Is Computer Engineering & Consulting not quite the opportunity you were looking for? Why not check out our selection of top dividend stocks.

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