Interested In Nam Hwa ConstructionLtd's (KOSDAQ:091590) Upcoming ₩70.00 Dividend? You Have Three Days Left

It looks like Nam Hwa Construction Co.,Ltd (KOSDAQ:091590) is about to go ex-dividend in the next three days. You will need to purchase shares before the 29th of December to receive the dividend, which will be paid on the 17th of April.

Nam Hwa ConstructionLtd's next dividend payment will be ₩70.00 per share, on the back of last year when the company paid a total of ₩70.00 to shareholders. Based on the last year's worth of payments, Nam Hwa ConstructionLtd has a trailing yield of 0.5% on the current stock price of ₩13450. We love seeing companies pay a dividend, but it's also important to be sure that laying the golden eggs isn't going to kill our golden goose! As a result, readers should always check whether Nam Hwa ConstructionLtd has been able to grow its dividends, or if the dividend might be cut.

View our latest analysis for Nam Hwa ConstructionLtd

Dividends are typically paid from company earnings. If a company pays more in dividends than it earned in profit, then the dividend could be unsustainable. Nam Hwa ConstructionLtd has a low and conservative payout ratio of just 15% of its income after tax. That said, even highly profitable companies sometimes might not generate enough cash to pay the dividend, which is why we should always check if the dividend is covered by cash flow. It paid out 4.8% of its free cash flow as dividends last year, which is conservatively low.

It's positive to see that Nam Hwa ConstructionLtd's dividend is covered by both profits and cash flow, since this is generally a sign that the dividend is sustainable, and a lower payout ratio usually suggests a greater margin of safety before the dividend gets cut.

Click here to see how much of its profit Nam Hwa ConstructionLtd paid out over the last 12 months.

Have Earnings And Dividends Been Growing?

Companies that aren't growing their earnings can still be valuable, but it is even more important to assess the sustainability of the dividend if it looks like the company will struggle to grow. If earnings decline and the company is forced to cut its dividend, investors could watch the value of their investment go up in smoke. With that in mind, we're not enthused to see that Nam Hwa ConstructionLtd's earnings per share have remained effectively flat over the past five years. It's better than seeing them drop, certainly, but over the long term, all of the best dividend stocks are able to meaningfully grow their earnings per share.

Given that Nam Hwa ConstructionLtd has only been paying a dividend for a year, there's not much of a past history to draw insight from.

Final Takeaway

Is Nam Hwa ConstructionLtd worth buying for its dividend? While it's not great to see that earnings per share are effectively flat over the one-year period we checked, at least the payout ratios are low and conservative. In summary, it's hard to get excited about Nam Hwa ConstructionLtd from a dividend perspective.

Keen to explore more data on Nam Hwa ConstructionLtd's financial performance? Check out our visualisation of its historical revenue and earnings growth.

A common investment mistake is buying the first interesting stock you see. Here you can find a list of promising dividend stocks with a greater than 2% yield and an upcoming dividend.

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This article by Simply Wall St is general in nature. 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.
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