Kallebäck Property Invest's (STO:KAPIAB) Dividend Will Be SEK3.00

The board of Kallebäck Property Invest AB (publ) (STO:KAPIAB) has announced that it will pay a dividend on the 8th of January, with investors receiving SEK3.00 per share. This means the annual payment will be 1.5% of the current stock price, which is lower than the industry average.

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Kallebäck Property Invest's Future Dividend Projections Appear Well Covered By Earnings

If it is predictable over a long period, even low dividend yields can be attractive. Based on the last payment, Kallebäck Property Invest was quite comfortably earning enough to cover the dividend. This means that a large portion of its earnings are being retained to grow the business.

Looking forward, EPS could fall by 1.9% if the company can't turn things around from the last few years. If the dividend continues along the path it has been on recently, we estimate the payout ratio could be 63%, which is definitely feasible to continue.

See our latest analysis for Kallebäck Property Invest

Dividend Volatility

The company's dividend history has been marked by instability, with at least one cut in the last 10 years. Since 2015, the dividend has gone from SEK10.00 total annually to SEK3.00. The dividend has fallen 70% over that period. A company that decreases its dividend over time generally isn't what we are looking for.

Kallebäck Property Invest May Find It Hard To Grow The Dividend

With a relatively unstable dividend, and a poor history of shrinking dividends, it's even more important to see if EPS is growing. However, Kallebäck Property Invest's EPS was effectively flat over the past five years, which could stop the company from paying more every year.

Our Thoughts On Kallebäck Property Invest's Dividend

In summary, while it's good to see that the dividend hasn't been cut, we are a bit cautious about Kallebäck Property Invest's payments, as there could be some issues with sustaining them into the future. The payments haven't been particularly stable and we don't see huge growth potential, but with the dividend well covered by cash flows it could prove to be reliable over the short term. We would be a touch cautious of relying on this stock primarily for the dividend income.

Companies possessing a stable dividend policy will likely enjoy greater investor interest than those suffering from a more inconsistent approach. At the same time, there are other factors our readers should be conscious of before pouring capital into a stock. Case in point: We've spotted 4 warning signs for Kallebäck Property Invest (of which 2 don't sit too well with us!) you should know about. Looking for more high-yielding dividend ideas? Try our collection of 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.