V-One Tech (KOSDAQ:251630) Has Affirmed Its Dividend Of ₩100.00

V-One Tech Co., Ltd.'s (KOSDAQ:251630) investors are due to receive a payment of ₩100.00 per share on 23rd of April. This makes the dividend yield 2.0%, which will augment investor returns quite nicely.

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V-One Tech's Distributions May Be Difficult To Sustain

We like to see robust dividend yields, but that doesn't matter if the payment isn't sustainable. Even though V-One Tech is not generating a profit, it is still paying a dividend. It is also not generating any free cash flow, we definitely have concerns when it comes to the sustainability of the dividend.

Recent, EPS has fallen by 52.5%, so this could continue over the next year. This will push the company into unprofitability, which means the managers will have to choose between suspending the dividend, or paying it out of cash reserves.

View our latest analysis for V-One Tech

V-One Tech Doesn't Have A Long Payment History

It is great to see that V-One Tech 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 payments haven't really changed that much since 7 years ago. Modest dividend growth is good to see, especially with the payments being relatively stable. However, the payment history is relatively short and we wouldn't want to rely on this dividend too much.

The Dividend Has Limited Growth Potential

Some investors will be chomping at the bit to buy some of the company's stock based on its dividend history. Let's not jump to conclusions as things might not be as good as they appear on the surface. Over the past five years, it looks as though V-One Tech's EPS has declined at around 53% a year. Such rapid declines definitely have the potential to constrain dividend payments if the trend continues into the future.

V-One Tech's Dividend Doesn't Look Great

Overall, this isn't a great candidate as an income investment, even though the dividend was stable this year. The company's earnings aren't high enough to be making such big distributions, and it isn't backed up by strong growth or consistency either. Overall, this doesn't get us very excited from an income standpoint.

Investors generally tend to favour companies with a consistent, stable dividend policy as opposed to those operating an irregular one. Still, investors need to consider a host of other factors, apart from dividend payments, when analysing a company. Case in point: We've spotted 3 warning signs for V-One Tech (of which 2 can't be ignored!) you should know about. Is V-One Tech not quite the opportunity you were looking for? Why not check out our selection of top dividend stocks.

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