Interested In Grupo Aeroportuario del Centro Norte. de's (BMV:OMAB) Upcoming Mex$5.767581 Dividend? You Have Four Days Left

It looks like Grupo Aeroportuario del Centro Norte, S.A.B. de C.V. (BMV:OMAB) is about to go ex-dividend in the next 4 days. 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. The ex-dividend date is an important date to be aware of as any purchase of the stock made on or after this date might mean a late settlement that doesn't show on the record date. This means that investors who purchase Grupo Aeroportuario del Centro Norte. de's shares on or after the 23rd of May will not receive the dividend, which will be paid on the 26th of May.

The company's next dividend payment will be Mex$5.767581 per share. Last year, in total, the company distributed Mex$10.89 to shareholders. Based on the last year's worth of payments, Grupo Aeroportuario del Centro Norte. de stock has a trailing yield of around 4.5% on the current share price of Mex$243.82. Dividends are an important source of income to many shareholders, but the health of the business is crucial to maintaining those dividends. So we need to check whether the dividend payments are covered, and if earnings are growing.

We've discovered 2 warning signs about Grupo Aeroportuario del Centro Norte. de. View them for free.

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. It paid out 84% of its earnings as dividends last year, which is not unreasonable, but limits reinvestment in the business and leaves the dividend vulnerable to a business downturn. It could become a concern if earnings started to decline. 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. Over the past year it paid out 119% of its free cash flow as dividends, which is uncomfortably high. It's hard to consistently pay out more cash than you generate without either borrowing or using company cash, so we'd wonder how the company justifies this payout level.

While Grupo Aeroportuario del Centro Norte. de's dividends were covered by the company's reported profits, cash is somewhat more important, so it's not great to see that the company didn't generate enough cash to pay its dividend. Were this to happen repeatedly, this would be a risk to Grupo Aeroportuario del Centro Norte. de's ability to maintain its dividend.

Check out our latest analysis for Grupo Aeroportuario del Centro Norte. de

Click here to see the company's payout ratio, plus analyst estimates of its future dividends.

Have Earnings And Dividends Been Growing?

Companies with consistently growing earnings per share generally make the best dividend stocks, as they usually find it easier to grow dividends per share. Investors love dividends, so if earnings fall and the dividend is reduced, expect a stock to be sold off heavily at the same time. For this reason, we're glad to see Grupo Aeroportuario del Centro Norte. de's earnings per share have risen 10% per annum over the last five years. Earnings have been growing at a decent rate, but we're concerned dividend payments consumed most of the company's cash flow over the past year.

The main way most investors will assess a company's dividend prospects is by checking the historical rate of dividend growth. Grupo Aeroportuario del Centro Norte. de has delivered 14% dividend growth per year on average over the past 10 years. Both per-share earnings and dividends have both been growing rapidly in recent times, which is great to see.

Final Takeaway

Is Grupo Aeroportuario del Centro Norte. de worth buying for its dividend? It's good to see that earnings per share are growing and that the company's payout ratio is within a normal range for most businesses. However we're somewhat concerned that it paid out 119% of its cashflow, which is uncomfortably high. Overall we're not hugely bearish on the stock, but there are likely better dividend investments out there.

However if you're still interested in Grupo Aeroportuario del Centro Norte. de as a potential investment, you should definitely consider some of the risks involved with Grupo Aeroportuario del Centro Norte. de. Every company has risks, and we've spotted 2 warning signs for Grupo Aeroportuario del Centro Norte. de you should know about.

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.