Yangzijiang Shipbuilding (Holdings)'s (SGX:BS6) Upcoming Dividend Will Be Larger Than Last Year's

Yangzijiang Shipbuilding (Holdings) Ltd.'s (SGX:BS6) dividend will be increasing from last year's payment of the same period to CN¥0.12 on 13th of May. This will take the dividend yield to an attractive 5.6%, providing a nice boost to shareholder returns.

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Yangzijiang Shipbuilding (Holdings)'s Projected Earnings Seem Likely To Cover Future Distributions

A big dividend yield for a few years doesn't mean much if it can't be sustained. However, prior to this announcement, Yangzijiang Shipbuilding (Holdings)'s dividend was comfortably covered by both cash flow and earnings. This means that most of what the business earns is being used to help it grow.

Over the next year, EPS is forecast to expand by 44.9%. Assuming the dividend continues along recent trends, we think the payout ratio could be 5.2% by next year, which is in a pretty sustainable range.

Check out our latest analysis for Yangzijiang Shipbuilding (Holdings)

Yangzijiang Shipbuilding (Holdings) Has A Solid Track Record

The company has been paying a dividend for a long time, and it has been quite stable which gives us confidence in the future dividend potential. The dividend has gone from an annual total of CN¥0.223 in 2015 to the most recent total annual payment of CN¥0.647. This means that it has been growing its distributions at 11% per annum over that time. So, dividends have been growing pretty quickly, and even more impressively, they haven't experienced any notable falls during this period.

The Dividend Looks Likely To Grow

Investors could be attracted to the stock based on the quality of its payment history. Yangzijiang Shipbuilding (Holdings) has impressed us by growing EPS at 16% per year over the past five years. A low payout ratio and decent growth suggests that the company is reinvesting well, and it also has plenty of room to increase the dividend over time.

We Really Like Yangzijiang Shipbuilding (Holdings)'s Dividend

Overall, we think this could be an attractive income stock, and it is only getting better by paying a higher dividend this year. Earnings are easily covering distributions, and the company is generating plenty of cash. All in all, this checks a lot of the boxes we look for when choosing an income stock.

Investors generally tend to favour companies with a consistent, stable dividend policy as opposed to those operating an irregular one. Meanwhile, despite the importance of dividend payments, they are not the only factors our readers should know when assessing a company. Earnings growth generally bodes well for the future value of company dividend payments. See if the 9 Yangzijiang Shipbuilding (Holdings) analysts we track are forecasting continued growth with our free report on analyst estimates for the company. Is Yangzijiang Shipbuilding (Holdings) not quite the opportunity you were looking for? Why not check out 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.