MSC (KOSDAQ:009780) Is Paying Out A Dividend Of ₩110.00

The board of MSC Co., Ltd. (KOSDAQ:009780) has announced that it will pay a dividend on the 27th of April, with investors receiving ₩110.00 per share. The dividend yield is 1.2% based on this payment, which is a little bit low compared to the other companies in the industry.

This technology could replace computers: discover the 20 stocks are working to make quantum computing a reality.

MSC's Future Dividend Projections Appear Well Covered By Earnings

Even a low dividend yield can be attractive if it is sustained for years on end. Before making this announcement, MSC was easily earning enough to cover the dividend. This means that most of what the business earns is being used to help it grow.

Looking forward, earnings per share could rise by 16.2% over the next year if the trend from the last few years continues. Assuming the dividend continues along recent trends, we think the payout ratio could be 7.6% by next year, which is in a pretty sustainable range.

See our latest analysis for MSC

MSC Is Still Building Its Track Record

It is great to see that MSC has been paying a stable dividend for a number of years now, however we want to be a bit cautious about whether this will remain true through a full economic cycle. The annual payment during the last 8 years was ₩30.00 in 2017, and the most recent fiscal year payment was ₩110.00. This means that it has been growing its distributions at 18% per annum over that time. MSC has been growing its dividend quite rapidly, which is exciting. However, the short payment history makes us question whether this performance will persist across a full market cycle.

The Dividend Looks Likely To Grow

The company's investors will be pleased to have been receiving dividend income for some time. We are encouraged to see that MSC has grown earnings per share at 16% per year over the past five years. MSC definitely has the potential to grow its dividend in the future with earnings on an uptrend and a low payout ratio.

MSC Looks Like A Great Dividend Stock

Overall, we like to see the dividend staying consistent, and we think MSC might even raise payments in the future. Earnings are easily covering distributions, and the company is generating plenty of cash. All of these factors considered, we think this has solid potential as a dividend stock.

Investors generally tend to favour companies with a consistent, stable dividend policy as opposed to those operating an irregular one. However, there are other things to consider for investors when analysing stock performance. As an example, we've identified 1 warning sign for MSC that you should be aware of before investing. Looking for more high-yielding dividend ideas? Try our collection of strong dividend payers.

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

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.