S.C. Foraj Sonde (BVB:FOJE) Could Be A Buy For Its Upcoming Dividend

S.C. Foraj Sonde S.A. (BVB:FOJE) is about to trade ex-dividend in the next three 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. Thus, you can purchase S.C. Foraj Sonde's shares before the 6th of June in order to receive the dividend, which the company will pay on the 28th of June.

The company's next dividend payment will be RON00.80 per share, on the back of last year when the company paid a total of RON0.90 to shareholders. Calculating the last year's worth of payments shows that S.C. Foraj Sonde has a trailing yield of 5.7% on the current share price of RON014.00. If you buy this business for its dividend, you should have an idea of whether S.C. Foraj Sonde's dividend is reliable and sustainable. So we need to check whether the dividend payments are covered, and if earnings are growing.

See our latest analysis for S.C. Foraj Sonde

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 S.C. Foraj Sonde paying out a modest 48% of its earnings.

Click here to see how much of its profit S.C. Foraj Sonde 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.

Unfortunately S.C. Foraj Sonde has only been paying a dividend for a year or so, so there's not much of a history to draw insight from.

To Sum It Up

Is S.C. Foraj Sonde worth buying for its 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. Overall, S.C. Foraj Sonde looks like a promising dividend stock in this analysis, and we think it would be worth investigating further.

In light of that, while S.C. Foraj Sonde has an appealing dividend, it's worth knowing the risks involved with this stock. For example, we've found 2 warning signs for S.C. Foraj Sonde that we recommend you consider before investing in the business.

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.