Three Days Left To Buy Hyundai Livart Furniture Company Limited (KRX:079430) Before The Ex-Dividend Date

Readers hoping to buy Hyundai Livart Furniture Company Limited (KRX:079430) for its dividend will need to make their move shortly, as the stock is about to trade ex-dividend. You can purchase shares before the 29th of December in order to receive the dividend, which the company will pay on the 27th of April.

Hyundai Livart Furniture's next dividend payment will be ₩150 per share, and in the last 12 months, the company paid a total of ₩150 per share. Based on the last year's worth of payments, Hyundai Livart Furniture has a trailing yield of 1.0% on the current stock price of ₩15300. If you buy this business for its dividend, you should have an idea of whether Hyundai Livart Furniture's dividend is reliable and sustainable. We need to see whether the dividend is covered by earnings and if it's growing.

Check out our latest analysis for Hyundai Livart Furniture

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. Hyundai Livart Furniture is paying out just 12% of its profit after tax, which is comfortably low and leaves plenty of breathing room in the case of adverse events. Yet cash flows are even more important than profits for assessing a dividend, so we need to see if the company generated enough cash to pay its distribution. Thankfully its dividend payments took up just 31% of the free cash flow it generated, which is a comfortable payout ratio.

It's encouraging to see that the dividend is covered by both profit and cash flow. This generally suggests the dividend is sustainable, as long as earnings don't drop precipitously.

Click here to see the company's payout ratio, plus analyst estimates of its future dividends.

Have Earnings And Dividends Been Growing?

When earnings decline, dividend companies become much harder to analyse and own safely. If earnings fall far enough, the company could be forced to cut its dividend. Readers will understand then, why we're concerned to see Hyundai Livart Furniture's earnings per share have dropped 5.0% a year over the past five years. When earnings per share fall, the maximum amount of dividends that can be paid also falls.

Another key way to measure a company's dividend prospects is by measuring its historical rate of dividend growth. Hyundai Livart Furniture has seen its dividend decline 5.0% per annum on average over the past 10 years, which is not great to see. While it's not great that earnings and dividends per share have fallen in recent years, we're encouraged by the fact that management has trimmed the dividend rather than risk over-committing the company in a risky attempt to maintain yields to shareholders.

To Sum It Up

Is Hyundai Livart Furniture worth buying for its dividend? Hyundai Livart Furniture has comfortably low cash and profit payout ratios, which may mean the dividend is sustainable even in the face of a sharp decline in earnings per share. Still, we consider declining earnings to be a warning sign. In summary, it's hard to get excited about Hyundai Livart Furniture from a dividend perspective.

While it's tempting to invest in Hyundai Livart Furniture for the dividends alone, you should always be mindful of the risks involved. Case in point: We've spotted 1 warning sign for Hyundai Livart Furniture you should be aware of.

We wouldn't recommend just buying the first dividend stock you see, though. Here's a list of interesting dividend stocks with a greater than 2% yield and an upcoming dividend.

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