FTGroup (TSE:2763) Is Paying Out A Dividend Of ¥20.00

The board of FTGroup Co., Ltd. (TSE:2763) has announced that it will pay a dividend on the 8th of December, with investors receiving ¥20.00 per share. This makes the dividend yield 4.5%, which will augment investor returns quite nicely.

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FTGroup's Payment Could Potentially Have Solid Earnings Coverage

While it is great to have a strong dividend yield, we should also consider whether the payment is sustainable. However, prior to this announcement, FTGroup'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 could expand by 12.9% if recent trends continue. Assuming the dividend continues along recent trends, we think the payout ratio could be 24% by next year, which is in a pretty sustainable range.

See our latest analysis for FTGroup

FTGroup Has A Solid Track Record

The company has been paying a dividend for a long time, and it has been quite stable which gives us confidence in the future dividend potential. Since 2015, the annual payment back then was ¥20.00, compared to the most recent full-year payment of ¥55.00. This means that it has been growing its distributions at 11% per annum over that time. It is good to see that there has been strong dividend growth, and that there haven't been any cuts for a long time.

The Dividend Looks Likely To Grow

The company's investors will be pleased to have been receiving dividend income for some time. We are encouraged to see that FTGroup has grown earnings per share at 13% per year over the past five years. FTGroup definitely has the potential to grow its dividend in the future with earnings on an uptrend and a low payout ratio.

FTGroup Looks Like A Great Dividend Stock

Overall, we like to see the dividend staying consistent, and we think FTGroup might even raise payments in the future. The company is easily earning enough to cover its dividend payments and it is great to see that these earnings are being translated into cash flow. 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. However, there are other things to consider for investors when analysing stock performance. Are management backing themselves to deliver performance? Check their shareholdings in FTGroup in our latest insider ownership analysis. Looking for more high-yielding dividend ideas? Try our collection of strong dividend payers.

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