Old Republic International Corporation (NYSE:ORI) Is About To Go Ex-Dividend, And It Pays A 8.0% Yield

It looks like Old Republic International Corporation (NYSE:ORI) is about to go ex-dividend in the next 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. It is important to be aware of the ex-dividend date because any trade on the stock needs to have been settled on or before the record date. Thus, you can purchase Old Republic International's shares before the 2nd of June in order to receive the dividend, which the company will pay on the 15th of June.

The company's next dividend payment will be US$0.24 per share, and in the last 12 months, the company paid a total of US$1.98 per share. Based on the last year's worth of payments, Old Republic International has a trailing yield of 8.0% on the current stock price of $24.77. 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! That's why we should always check whether the dividend payments appear sustainable, and if the company is growing.

Check out our latest analysis for Old Republic International

Dividends are usually paid out of company profits, so if a company pays out more than it earned then its dividend is usually at greater risk of being cut. Old Republic International paid out a comfortable 48% of its profit last year.

Companies that pay out less in dividends than they earn in profits generally have more sustainable dividends. The lower the payout ratio, the more wiggle room the business has before it could be forced to cut the dividend.

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

Have Earnings And Dividends Been Growing?

Companies that aren't growing their earnings can still be valuable, but it is even more important to assess the sustainability of the dividend if it looks like the company will struggle to grow. Investors love dividends, so if earnings fall and the dividend is reduced, expect a stock to be sold off heavily at the same time. It's not encouraging to see that Old Republic International's earnings are effectively flat over the past five years. We'd take that over an earnings decline any day, but in the long run, the best dividend stocks all grow their earnings per share.

The main way most investors will assess a company's dividend prospects is by checking the historical rate of dividend growth. Since the start of our data, 10 years ago, Old Republic International has lifted its dividend by approximately 11% a year on average.

Final Takeaway

Is Old Republic International worth buying for its dividend? Old Republic International's earnings per share have not grown at all in recent years, although we like that it is paying out a low percentage of its earnings. We're unconvinced on the company's merits, and think there might be better opportunities out there.

So if you want to do more digging on Old Republic International, you'll find it worthwhile knowing the risks that this stock faces. For example - Old Republic International has 2 warning signs we think you should be aware of.

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.