Income Investors Should Know That Nice Information & Telecommunication, Inc. (KOSDAQ:036800) Goes Ex-Dividend Soon

Nice Information & Telecommunication, Inc. (KOSDAQ:036800) stock is about to trade ex-dividend in 3 days. This means that investors who purchase shares on or after the 29th of December will not receive the dividend, which will be paid on the 14th of April.

Nice Information & Telecommunication's next dividend payment will be ₩460 per share, on the back of last year when the company paid a total of ₩460 to shareholders. Based on the last year's worth of payments, Nice Information & Telecommunication stock has a trailing yield of around 1.6% on the current share price of ₩28000. 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 Nice Information & Telecommunication has been able to grow its dividends, or if the dividend might be cut.

View our latest analysis for Nice Information & Telecommunication

Dividends are usually paid out of company profits, so if a company pays out more than it earned then its dividend is usually at greater risk of being cut. Nice Information & Telecommunication paid out just 17% of its profit last year, which we think is conservatively low and leaves plenty of margin for unexpected circumstances. Yet cash flow is typically more important than profit for assessing dividend sustainability, so we should always check if the company generated enough cash to afford its dividend. Luckily it paid out just 12% of its free cash flow 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 Nice Information & Telecommunication paid out over the last 12 months.

Have Earnings And Dividends Been Growing?

Companies with falling earnings are riskier for dividend shareholders. If business enters a downturn and the dividend is cut, the company could see its value fall precipitously. So we're not too excited that Nice Information & Telecommunication's earnings are down 2.8% a year over the past five years.

The main way most investors will assess a company's dividend prospects is by checking the historical rate of dividend growth. Since the start of our data, 10 years ago, Nice Information & Telecommunication has lifted its dividend by approximately 12% a year on average.

The Bottom Line

Should investors buy Nice Information & Telecommunication for the upcoming dividend? Earnings per share are down meaningfully, although at least the company is paying out a low and conservative percentage of both its earnings and cash flow. It's definitely not great to see earnings falling, but at least there may be some buffer before the dividend needs to be cut. It might be worth researching if the company is reinvesting in growth projects that could grow earnings and dividends in the future, but for now we're not all that optimistic on its dividend prospects.

In light of that, while Nice Information & Telecommunication has an appealing dividend, it's worth knowing the risks involved with this stock. To help with this, we've discovered 1 warning sign for Nice Information & Telecommunication that you should be aware of before investing in their shares.

A common investment mistake is buying the first interesting stock you see. Here you can find a list of promising dividend stocks with a greater than 2% yield and an upcoming dividend.

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