CROWNHAITAI HoldingsLtd (KRX:005740) Has Affirmed Its Dividend Of ₩130.00

CROWNHAITAI Holdings Co.,Ltd. (KRX:005740) has announced that it will pay a dividend of ₩130.00 per share on the 27th of April. This means the annual payment will be 1.5% of the current stock price, which is lower than the industry average.

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CROWNHAITAI HoldingsLtd's Payment Could Potentially Have Solid Earnings Coverage

If it is predictable over a long period, even low dividend yields can be attractive. However, prior to this announcement, CROWNHAITAI HoldingsLtd's dividend was comfortably covered by both cash flow and earnings. This means that most of its earnings are being retained to grow the business.

Over the next year, EPS could expand by 39.5% if recent trends continue. Assuming the dividend continues along recent trends, we think the payout ratio could be 7.3% by next year, which is in a pretty sustainable range.

Check out our latest analysis for CROWNHAITAI HoldingsLtd

CROWNHAITAI HoldingsLtd's Dividend Has Lacked Consistency

It's comforting to see that CROWNHAITAI HoldingsLtd has been paying a dividend for a number of years now, however it has been cut at least once in that time. This suggests that the dividend might not be the most reliable. The annual payment during the last 9 years was ₩3030.3 in 2016, and the most recent fiscal year payment was ₩100.00. The dividend has fallen 97% over that period. Generally, we don't like to see a dividend that has been declining over time as this can degrade shareholders' returns and indicate that the company may be running into problems.

The Dividend Looks Likely To Grow

Given that the track record hasn't been stellar, we really want to see earnings per share growing over time. CROWNHAITAI HoldingsLtd has seen EPS rising for the last five years, at 40% per annum. Earnings per share is growing at a solid clip, and the payout ratio is low which we think is an ideal combination in a dividend stock as the company can quite easily raise the dividend in the future.

CROWNHAITAI HoldingsLtd Looks Like A Great Dividend Stock

Overall, we like to see the dividend staying consistent, and we think CROWNHAITAI HoldingsLtd might even raise payments in the future. Distributions are quite easily covered by earnings, which are also being converted to cash flows. All in all, this checks a lot of the boxes we look for when choosing an income stock.

It's important to note that companies having a consistent dividend policy will generate greater investor confidence than those having an erratic one. Meanwhile, despite the importance of dividend payments, they are not the only factors our readers should know when assessing a company. For example, we've picked out 2 warning signs for CROWNHAITAI HoldingsLtd that investors should know about before committing capital to this stock. 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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