Is It Smart To Buy Qatar Islamic Bank (Q.P.S.C.) (DSM:QIBK) Before It Goes Ex-Dividend?

Qatar Islamic Bank (Q.P.S.C.) (DSM:QIBK) stock is about to trade ex-dividend in 2 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. 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. Therefore, if you purchase Qatar Islamic Bank (Q.P.S.C.)'s shares on or after the 25th of July, you won't be eligible to receive the dividend, when it is paid on the 1st of January.

The company's next dividend payment will be ر.ق0.25 per share. Last year, in total, the company distributed ر.ق0.72 to shareholders. Based on the last year's worth of payments, Qatar Islamic Bank (Q.P.S.C.) stock has a trailing yield of around 3.8% on the current share price of ر.ق19.30. If you buy this business for its dividend, you should have an idea of whether Qatar Islamic Bank (Q.P.S.C.)'s dividend is reliable and sustainable. As a result, readers should always check whether Qatar Islamic Bank (Q.P.S.C.) has been able to grow its dividends, or if the dividend might be cut.

View our latest analysis for Qatar Islamic Bank (Q.P.S.C.)

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. Qatar Islamic Bank (Q.P.S.C.) paid out a comfortable 41% of its profit last year.

Generally speaking, the lower a company's payout ratios, the more resilient its dividend usually is.

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

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 earnings decline and the company is forced to cut its dividend, investors could watch the value of their investment go up in smoke. For this reason, we're glad to see Qatar Islamic Bank (Q.P.S.C.)'s earnings per share have risen 10% per annum over the last five years.

Another key way to measure a company's dividend prospects is by measuring its historical rate of dividend growth. Qatar Islamic Bank (Q.P.S.C.) has delivered an average of 6.1% per year annual increase in its dividend, based on the past 10 years of dividend payments. It's encouraging to see the company lifting dividends while earnings are growing, suggesting at least some corporate interest in rewarding shareholders.

To Sum It Up

Should investors buy Qatar Islamic Bank (Q.P.S.C.) for the upcoming dividend? Typically, companies that are growing rapidly and paying out a low fraction of earnings are keeping the profits for reinvestment in the business. Perhaps even more importantly - this can sometimes signal management is focused on the long term future of the business. In summary, Qatar Islamic Bank (Q.P.S.C.) appears to have some promise as a dividend stock, and we'd suggest taking a closer look at it.

Ever wonder what the future holds for Qatar Islamic Bank (Q.P.S.C.)? See what the five analysts we track are forecasting, with this visualisation of its historical and future estimated earnings and cash flow

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com