UNISEM Co., Ltd. (KOSDAQ:036200) Passed Our Checks, And It's About To Pay A ₩80.00 Dividend

UNISEM Co., Ltd. (KOSDAQ:036200) stock is about to trade ex-dividend in 3 days. You can purchase shares before the 29th of December in order to receive the dividend, which the company will pay on the 27th of March.

The upcoming dividend for UNISEM will put a total of ₩80.00 per share in shareholders' pockets, up from last year's total dividends of ₩50.00. 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 UNISEM has been able to grow its dividends, or if the dividend might be cut.

Check out our latest analysis for UNISEM

If a company pays out more in dividends than it earned, then the dividend might become unsustainable - hardly an ideal situation. UNISEM paid out just 5.0% of its profit last year, which we think is conservatively low and leaves plenty of margin for unexpected circumstances. 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. The good news is it paid out just 4.6% of its free cash flow in the last year.

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 how much of its profit UNISEM 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. That's why it's comforting to see UNISEM's earnings have been skyrocketing, up 48% per annum for the past five years. UNISEM looks like a real growth company, with earnings per share growing at a cracking pace and the company reinvesting most of its profits in the business.

Unfortunately UNISEM has only been paying a dividend for a year or so, so there's not much of a history to draw insight from.

To Sum It Up

From a dividend perspective, should investors buy or avoid UNISEM? We love that UNISEM is growing earnings per share while simultaneously paying out a low percentage of both its earnings and cash flow. These characteristics suggest the company is reinvesting in growing its business, while the conservative payout ratio also implies a reduced risk of the dividend being cut in the future. Overall we think this is an attractive combination and worthy of further research.

Want to learn more about UNISEM's dividend performance? Check out this visualisation of its historical revenue and earnings growth.

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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