Corticeira Amorim, S.G.P.S., S.A. (ELI:COR) Looks Like A Good Stock, And It's Going Ex-Dividend Soon

Corticeira Amorim, S.G.P.S., S.A. (ELI:COR) is about to trade ex-dividend in the next four days. The ex-dividend date occurs one day before the record date which is the day on which shareholders need to be on the company's books in order 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. Meaning, you will need to purchase Corticeira Amorim S.G.P.S' shares before the 11th of May to receive the dividend, which will be paid on the 15th of May.

The company's upcoming dividend is €0.20 a share, following on from the last 12 months, when the company distributed a total of €0.40 per share to shareholders. Last year's total dividend payments show that Corticeira Amorim S.G.P.S has a trailing yield of 3.9% on the current share price of €10.34. 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.

Check out our latest analysis for Corticeira Amorim S.G.P.S

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. That's why it's good to see Corticeira Amorim S.G.P.S paying out a modest 33% of its earnings. Corticeira Amorim S.G.P.S paid a dividend despite reporting negative free cash flow last year. That's typically a bad combination and - if this were more than a one-off - not sustainable.

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

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. Investors love dividends, so if earnings fall and the dividend is reduced, expect a stock to be sold off heavily at the same time. This is why it's a relief to see Corticeira Amorim S.G.P.S earnings per share are up 6.1% per annum over the last five years.

Many investors will assess a company's dividend performance by evaluating how much the dividend payments have changed over time. Corticeira Amorim S.G.P.S has delivered an average of 9.6% per year annual increase in its dividend, based on the past 10 years of dividend payments. We're glad to see dividends rising alongside earnings over a number of years, which may be a sign the company intends to share the growth with shareholders.

To Sum It Up

Is Corticeira Amorim S.G.P.S an attractive dividend stock, or better left on the shelf? Corticeira Amorim S.G.P.S has seen its earnings per share grow slowly in recent years, and the company reinvests more than half of its profits in the business, which generally bodes well for its future prospects. Corticeira Amorim S.G.P.S ticks a lot of boxes for us from a dividend perspective, and we think these characteristics should mark the company as deserving of further attention.

While it's tempting to invest in Corticeira Amorim S.G.P.S for the dividends alone, you should always be mindful of the risks involved. Our analysis shows 1 warning sign for Corticeira Amorim S.G.P.S and you should be aware of this before buying any shares.

A common investing mistake is buying the first interesting stock you see. Here you can find a full list of high-yield 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.