Readers hoping to buy Zaklady Magnezytowe ROPCZYCE S.A. (WSE:RPC) 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 23rd of September, you won't be eligible to receive this dividend, when it is paid on the 12th of October.
Zaklady Magnezytowe ROPCZYCE's next dividend payment will be zł1.00 per share. Last year, in total, the company distributed zł1.00 to shareholders. Calculating the last year's worth of payments shows that Zaklady Magnezytowe ROPCZYCE has a trailing yield of 4.0% on the current share price of PLN24.7. Dividends are an important source of income to many shareholders, but the health of the business is crucial to maintaining those dividends. As a result, readers should always check whether Zaklady Magnezytowe ROPCZYCE has been able to grow its dividends, or if the dividend might be cut.
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. Zaklady Magnezytowe ROPCZYCE is paying out just 19% of its profit after tax, which is comfortably low and leaves plenty of breathing room in the case of adverse events. Yet cash flows are even more important than profits for assessing a dividend, so we need to see if the company generated enough cash to pay its distribution.
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. If business enters a downturn and the dividend is cut, the company could see its value fall precipitously. Fortunately for readers, Zaklady Magnezytowe ROPCZYCE's earnings per share have been growing at 20% a year for the past five years. The company has managed to grow earnings at a rapid rate, while reinvesting most of the profits within the business. This will make it easier to fund future growth efforts and we think this is an attractive combination - plus the dividend can always be increased later.
The main way most investors will assess a company's dividend prospects is by checking the historical rate of dividend growth. Zaklady Magnezytowe ROPCZYCE has delivered 14% dividend growth per year on average over the past eight years. Both per-share earnings and dividends have both been growing rapidly in recent times, which is great to see.
To Sum It Up
Has Zaklady Magnezytowe ROPCZYCE got what it takes to maintain its dividend payments? It's great that Zaklady Magnezytowe ROPCZYCE is growing earnings per share while simultaneously paying out a low percentage of both its earnings and cash flow. It's disappointing to see the dividend has been cut at least once in the past, but as things stand now, the low payout ratio suggests a conservative approach to dividends, which we like. There's a lot to like about Zaklady Magnezytowe ROPCZYCE, and we would prioritise taking a closer look at it.
In light of that, while Zaklady Magnezytowe ROPCZYCE has an appealing dividend, it's worth knowing the risks involved with this stock. For example, we've found 2 warning signs for Zaklady Magnezytowe ROPCZYCE that we recommend you consider before investing in the business.
We wouldn't recommend just buying the first dividend stock you see, though. Here's a list of interesting 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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