UBIVELOX Inc (KOSDAQ:089850) Looks Interesting, And It's About To Pay A Dividend

UBIVELOX Inc (KOSDAQ:089850) is about to trade ex-dividend in the next 3 days. The ex-dividend date is usually set to be one business day before the record date which is the cut-off date on which you must be present on the company's books as a shareholder in order to receive the dividend. The ex-dividend date is important as the process of settlement involves two full business days. So if you miss that date, you would not show up on the company's books on the record date. In other words, investors can purchase UBIVELOX's shares before the 27th of December in order to be eligible for the dividend, which will be paid on the 18th of April.

The company's next dividend payment will be ₩140.00 per share. Last year, in total, the company distributed ₩140 to shareholders. Based on the last year's worth of payments, UBIVELOX stock has a trailing yield of around 2.2% on the current share price of ₩6430.00. 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 UBIVELOX has been able to grow its dividends, or if the dividend might be cut.

View our latest analysis for UBIVELOX

Dividends are typically paid out of company income, so if a company pays out more than it earned, its dividend is usually at a higher risk of being cut. UBIVELOX is paying out just 18% of its profit after tax, which is comfortably low and leaves plenty of breathing room in the case of adverse events. 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. UBIVELOX paid a dividend despite reporting negative free cash flow last year. That's typically a bad combination and - if this were more than a one-off - not sustainable.

Click here to see how much of its profit UBIVELOX 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. It's encouraging to see UBIVELOX has grown its earnings rapidly, up 21% a year for the past five years.

Given that UBIVELOX has only been paying a dividend for a year, there's not much of a past history to draw insight from.

The Bottom Line

Should investors buy UBIVELOX for the upcoming dividend? We like that UBIVELOX 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 we're not hugely bearish on the stock, but there are likely better dividend investments out there.

On that note, you'll want to research what risks UBIVELOX is facing. Every company has risks, and we've spotted 2 warning signs for UBIVELOX you should know about.

If you're in the market for strong dividend payers, we recommend checking our selection of top dividend stocks.

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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.