YNH Property Bhd (KLSE:YNHPROP) Goes Ex-Dividend Soon

Readers hoping to buy YNH Property Bhd (KLSE:YNHPROP) for its dividend will need to make their move shortly, as the stock is about to trade ex-dividend. If you purchase the stock on or after the 24th of November, you won't be eligible to receive this dividend, when it is paid on the 24th of December.

YNH Property Bhd's next dividend payment will be RM0.025 per share, and in the last 12 months, the company paid a total of RM0.025 per share. Based on the last year's worth of payments, YNH Property Bhd stock has a trailing yield of around 0.9% on the current share price of MYR2.75. 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 YNH Property Bhd has been able to grow its dividends, or if the dividend might be cut.

See our latest analysis for YNH Property Bhd

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. Fortunately YNH Property Bhd's payout ratio is modest, at just 41% of profit.

Click here to see how much of its profit YNH Property Bhd paid out over the last 12 months.

Have Earnings And Dividends Been Growing?

Businesses with shrinking earnings are tricky from a dividend perspective. Investors love dividends, so if earnings fall and the dividend is reduced, expect a stock to be sold off heavily at the same time. YNH Property Bhd's earnings per share have fallen at approximately 8.5% a year over the previous five years. Such a sharp decline casts doubt on the future sustainability of the dividend.

YNH Property Bhd also issued more than 5% of its market cap in new stock during the past year, which we feel is likely to hurt its dividend prospects in the long run. Trying to grow the dividend while issuing large amounts of new shares reminds us of the ancient Greek tale of Sisyphus - perpetually pushing a boulder uphill.

The main way most investors will assess a company's dividend prospects is by checking the historical rate of dividend growth. In the last 10 years, YNH Property Bhd has lifted its dividend by approximately 7.2% a year on average.

To Sum It Up

From a dividend perspective, should investors buy or avoid YNH Property Bhd? Earnings per share have shrunk noticeably in recent years, although we like that the company has a low payout ratio. This could suggest a cut to the dividend may not be a major risk in the near future. We think this is a pretty attractive combination, and would be interested in investigating YNH Property Bhd more closely.

On that note, you'll want to research what risks YNH Property Bhd is facing. We've identified 2 warning signs with YNH Property Bhd (at least 1 which is concerning), and understanding them should be part of your investment process.

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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This article by Simply Wall St is general in nature. 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.
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