SCI Information Service Inc. (KOSDAQ:036120) Looks Like A Good Stock, And It's Going Ex-Dividend Soon

SCI Information Service Inc. (KOSDAQ:036120) stock is about to trade ex-dividend in 3 days. Investors can purchase shares before the 29th of December in order to be eligible for this dividend, which will be paid on the 17th of April.

SCI Information Service's next dividend payment will be ₩69.00 per share, on the back of last year when the company paid a total of ₩69.00 to shareholders. Calculating the last year's worth of payments shows that SCI Information Service has a trailing yield of 1.6% on the current share price of ₩4265. 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 SCI Information Service has been able to grow its dividends, or if the dividend might be cut.

View our latest analysis for SCI Information Service

Dividends are usually paid out of company profits, so if a company pays out more than it earned then its dividend is usually at greater risk of being cut. Fortunately SCI Information Service's payout ratio is modest, at just 39% of profit.

Generally speaking, the lower a company's payout ratios, the more resilient its dividend usually is.

Click here to see how much of its profit SCI Information Service paid out over the last 12 months.

Have Earnings And Dividends Been Growing?

Businesses with strong growth prospects usually make the best dividend payers, because it's easier to grow dividends when earnings per share are improving. If earnings fall far enough, the company could be forced to cut its dividend. It's encouraging to see SCI Information Service has grown its earnings rapidly, up 53% a year for the past five years.

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

To Sum It Up

Is SCI Information Service worth buying for its dividend? Typically, companies that are growing rapidly and paying out a low fraction of earnings are keeping the profits for reinvestment in the business. This is one of the most attractive investment combinations under this analysis, as it can create substantial value for investors over the long run. We think this is a pretty attractive combination, and would be interested in investigating SCI Information Service more closely.

While it's tempting to invest in SCI Information Service for the dividends alone, you should always be mindful of the risks involved. Every company has risks, and we've spotted 2 warning signs for SCI Information Service you should know about.

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.

If you’re looking to trade SCI Information Service, open an account with the lowest-cost* platform trusted by professionals, Interactive Brokers. Their clients from over 200 countries and territories trade stocks, options, futures, forex, bonds and funds worldwide from a single integrated account. Promoted

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.
^*Interactive Brokers Rated Lowest Cost Broker by StockBrokers.com Annual Online Review 2020

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.