Kona I Co.,Ltd. (KOSDAQ:052400) Looks Like A Good Stock, And It's Going Ex-Dividend Soon

Readers hoping to buy Kona I Co.,Ltd. (KOSDAQ:052400) for its dividend will need to make their move shortly, as the stock is about to trade ex-dividend. The ex-dividend date is two business days before a company's record date in most cases, which is the date on which the company determines which shareholders are entitled to receive a dividend. It is important to be aware of the ex-dividend date because any trade on the stock needs to have been settled on or before the record date. In other words, investors can purchase Kona ILtd's shares before the 20th of March in order to be eligible for the dividend, which will be paid on the 1st of January.

The company's upcoming dividend is ₩680.00 a share, following on from the last 12 months, when the company distributed a total of ₩500 per share to shareholders. Based on the last year's worth of payments, Kona ILtd has a trailing yield of 1.8% on the current stock price of ₩27950.00. 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! So we need to investigate whether Kona ILtd can afford its dividend, and if the dividend could grow.

Check out our latest analysis for Kona ILtd

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. Fortunately Kona ILtd's payout ratio is modest, at just 26% of profit. 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.

Click here to see how much of its profit Kona ILtd 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 fall far enough, the company could be forced to cut its dividend. It's encouraging to see Kona ILtd has grown its earnings rapidly, up 30% a year for the past five years.

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

Final Takeaway

Is Kona ILtd worth buying for its dividend? We're glad to see the company has been improving its earnings per share while also paying out a low percentage of income. However, it's not great to see it paying out what we see as an uncomfortably high percentage of its cash flow. While it does have some good things going for it, we're a bit ambivalent and it would take more to convince us of Kona ILtd's dividend merits.

On that note, you'll want to research what risks Kona ILtd is facing. For example - Kona ILtd has 2 warning signs we think you should be aware of.

Generally, we wouldn't recommend just buying the first dividend stock you see. Here's a curated list of interesting stocks that are strong dividend payers.

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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.