There's A Lot To Like About MPL Verbum's (WSE:VER) Upcoming zł0.18 Dividend

It looks like MPL Verbum S.A. (WSE:VER) is about to go ex-dividend in the next 4 days. Typically, the ex-dividend date is one business day before the record date which is the date on which a company determines the shareholders eligible 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. This means that investors who purchase MPL Verbum's shares on or after the 25th of November will not receive the dividend, which will be paid on the 6th of December.

The company's upcoming dividend is zł0.18 a share, following on from the last 12 months, when the company distributed a total of zł0.15 per share to shareholders. Last year's total dividend payments show that MPL Verbum has a trailing yield of 2.3% on the current share price of zł7.90. Dividends are a major contributor to investment returns for long term holders, but only if the dividend continues to be paid. As a result, readers should always check whether MPL Verbum has been able to grow its dividends, or if the dividend might be cut.

See our latest analysis for MPL Verbum

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. Fortunately MPL Verbum's payout ratio is modest, at just 27% of profit.

Click here to see how much of its profit MPL Verbum paid out over the last 12 months.

Have Earnings And Dividends Been Growing?

Businesses with strong growth prospects usually make the best dividend payers, because it's easier to grow dividends when earnings per share are improving. If earnings fall far enough, the company could be forced to cut its dividend. That's why it's comforting to see MPL Verbum's earnings have been skyrocketing, up 33% per annum for the past five years.

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, MPL Verbum has lifted its dividend by approximately 14% a year on average. Both per-share earnings and dividends have both been growing rapidly in recent times, which is great to see.

To Sum It Up

Is MPL Verbum worth buying for its dividend? It's great that MPL Verbum 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. It's a promising combination that should mark this company worthy of closer attention.

While it's tempting to invest in MPL Verbum for the dividends alone, you should always be mindful of the risks involved. For instance, we've identified 2 warning signs for MPL Verbum (1 is potentially serious) you should be aware of.

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.