Is It Smart To Buy Vistin Pharma ASA (OB:VISTN) Before It Goes Ex-Dividend?

Readers hoping to buy Vistin Pharma ASA (OB:VISTN) for its dividend will need to make their move shortly, as the stock is about to trade ex-dividend. 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. Therefore, if you purchase Vistin Pharma's shares on or after the 23rd of January, you won't be eligible to receive the dividend, when it is paid on the 30th of January.

The company's next dividend payment will be kr0.75 per share, and in the last 12 months, the company paid a total of kr0.75 per share. Looking at the last 12 months of distributions, Vistin Pharma has a trailing yield of approximately 3.1% on its current stock price of NOK23.9. 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 Vistin Pharma has been able to grow its dividends, or if the dividend might be cut.

Check out our latest analysis for Vistin Pharma

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. Vistin Pharma paid out 75% of its earnings to investors last year, a normal payout level for most businesses.

Click here to see how much of its profit Vistin Pharma 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. Investors love dividends, so if earnings fall and the dividend is reduced, expect a stock to be sold off heavily at the same time. That's why it's comforting to see Vistin Pharma's earnings have been skyrocketing, up 26% per annum for the past five years. The current payout ratio suggests a good balance between rewarding shareholders with dividends, and reinvesting in growth. Earnings per share have been growing quickly and in combination with some reinvestment and a middling payout ratio, the stock may have decent dividend prospects going forwards.

Another key way to measure a company's dividend prospects is by measuring its historical rate of dividend growth. Vistin Pharma has delivered 2.8% dividend growth per year on average over the past eight years. Earnings per share have been growing much quicker than dividends, potentially because Vistin Pharma is keeping back more of its profits to grow the business.

To Sum It Up

Is Vistin Pharma worth buying for its dividend? Earnings per share are growing nicely, and Vistin Pharma is paying out a percentage of its earnings that is around the average for dividend-paying stocks. Overall, Vistin Pharma looks like a promising dividend stock in this analysis, and we think it would be worth investigating further.

Curious about whether Vistin Pharma has been able to consistently generate growth? Here's a chart of its historical revenue and earnings growth.

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.