CoinShares International Limited (STO:CS) Stock Goes Ex-Dividend In Just One Day

Some investors rely on dividends for growing their wealth, and if you're one of those dividend sleuths, you might be intrigued to know that CoinShares International Limited (STO:CS) is about to go ex-dividend in just day or so. The ex-dividend date is usually set to be one business day before the record date which is the cut-off date on which you must be present on the company's books as a shareholder in order to receive the dividend. The ex-dividend date is important as the process of settlement involves two full business days. So if you miss that date, you would not show up on the company's books on the record date. This means that investors who purchase CoinShares International's shares on or after the 27th of June will not receive the dividend, which will be paid on the 3rd of July.

The upcoming dividend for CoinShares International is UK£0.0325 per share. We love seeing companies pay a dividend, but it's also important to be sure that laying the golden eggs isn't going to kill our golden goose! So we need to investigate whether CoinShares International can afford its dividend, and if the dividend could grow.

See our latest analysis for CoinShares International

Dividends are typically paid from company earnings. If a company pays more in dividends than it earned in profit, then the dividend could be unsustainable. CoinShares International reported a loss last year, so it's not great to see that it has continued paying a dividend. CoinShares International paid a dividend despite reporting negative free cash flow over the last twelve months. This may be due to heavy investment in the business, but this is still suboptimal from a dividend sustainability perspective.

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

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. If business enters a downturn and the dividend is cut, the company could see its value fall precipitously. CoinShares International was unprofitable last year, but at least the general trend suggests its earnings have been improving over the past five years. Even so, an unprofitable company whose business does not quickly recover is usually not a good candidate for dividend investors.

This is CoinShares International's first year of paying a regular dividend, so it doesn't have much of a history yet to compare to.

Get our latest analysis on CoinShares International's balance sheet health here.

Final Takeaway

Is CoinShares International worth buying for its dividend? We're uncomfortable with the fact that CoinShares International paid a dividend while being loss-making. In sum this is a middling combination, and we find it hard to get excited about the company from a dividend perspective.

If you want to look further into CoinShares International, it's worth knowing the risks this business faces. We've identified 2 warning signs with CoinShares International (at least 1 which is a bit concerning), and understanding them should be part of your investment process.

Generally, we wouldn't recommend just buying the first dividend stock you see. Here's a curated list of interesting stocks that are strong dividend payers.

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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