eSang Networks Co.,Ltd (KOSDAQ:080010) Looks Interesting, And It's About To Pay A Dividend

Some investors rely on dividends for growing their wealth, and if you're one of those dividend sleuths, you might be intrigued to know that eSang Networks Co.,Ltd (KOSDAQ:080010) is about to go ex-dividend in just three days. Ex-dividend means that investors that purchase the stock on or after the 29th of December will not receive this dividend, which will be paid on the 14th of April.

eSang NetworksLtd's next dividend payment will be ₩100.00 per share. Last year, in total, the company distributed ₩100.00 to shareholders. Last year's total dividend payments show that eSang NetworksLtd has a trailing yield of 1.4% on the current share price of ₩7200. If you buy this business for its dividend, you should have an idea of whether eSang NetworksLtd's dividend is reliable and sustainable. As a result, readers should always check whether eSang NetworksLtd has been able to grow its dividends, or if the dividend might be cut.

See our latest analysis for eSang NetworksLtd

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. eSang NetworksLtd is paying out just 11% of its profit after tax, which is comfortably low and leaves plenty of breathing room in the case of adverse events. 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.

Click here to see how much of its profit eSang NetworksLtd paid out over the last 12 months.

Have Earnings And Dividends Been Growing?

Stocks in companies that generate sustainable earnings growth often make the best dividend prospects, as it is easier to lift the dividend when earnings are rising. If earnings decline and the company is forced to cut its dividend, investors could watch the value of their investment go up in smoke. That's why it's comforting to see eSang NetworksLtd's earnings have been skyrocketing, up 25% per annum for the past five years.

Given that eSang NetworksLtd 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 eSang NetworksLtd an attractive dividend stock, or better left on the shelf? We like that eSang NetworksLtd has been successfully growing its earnings per share at a nice rate and reinvesting most of its profits in the business. However, we note the high cashflow payout ratio with some concern. Overall, it's not a bad combination, but we feel that there are likely more attractive dividend prospects out there.

On that note, you'll want to research what risks eSang NetworksLtd is facing. To help with this, we've discovered 3 warning signs for eSang NetworksLtd that you should be aware of before investing in their shares.

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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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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