OIZUMI (TSE:6428) Has Affirmed Its Dividend Of ¥12.00

The board of OIZUMI Corporation (TSE:6428) has announced that it will pay a dividend of ¥12.00 per share on the 30th of June. This means the annual payment is 3.7% of the current stock price, which is above the average for the industry.

We've found 21 US stocks that are forecast to pay a dividend yield of over 6% next year. See the full list for free.

OIZUMI's Future Dividends May Potentially Be At Risk

If the payments aren't sustainable, a high yield for a few years won't matter that much. Based on the last payment, earnings were actually smaller than the dividend, and the company was actually spending more cash than it was making. This high of a dividend payment could start to put pressure on the balance sheet in the future.

If the company can't turn things around, EPS could fall by 48.8% over the next year. If the dividend continues along the path it has been on recently, the payout ratio in 12 months could be 1,658%, which is definitely a bit high to be sustainable going forward.

View our latest analysis for OIZUMI

OIZUMI Has A Solid Track Record

The company has a sustained record of paying dividends with very little fluctuation. Since 2015, the dividend has gone from ¥8.00 total annually to ¥12.00. This works out to be a compound annual growth rate (CAGR) of approximately 4.1% a year over that time. Dividends have grown relatively slowly, which is not great, but some investors may value the relative consistency of the dividend.

Dividend Growth Potential Is Shaky

The company's investors will be pleased to have been receiving dividend income for some time. However, initial appearances might be deceiving. Over the past five years, it looks as though OIZUMI's EPS has declined at around 49% a year. Dividend payments are likely to come under some pressure unless EPS can pull out of the nosedive it is in.

OIZUMI's Dividend Doesn't Look Sustainable

Overall, it's nice to see a consistent dividend payment, but we think that longer term, the current level of payment might be unsustainable. We can't deny that the payments have been very stable, but we are a little bit worried about the very high payout ratio. Overall, we don't think this company has the makings of a good income stock.

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. Just as an example, we've come across 6 warning signs for OIZUMI you should be aware of, and 3 of them are a bit concerning. 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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