Interested In Brookfield Infrastructure's (NYSE:BIPC) Upcoming US$0.43 Dividend? You Have Four Days Left

Regular readers will know that we love our dividends at Simply Wall St, which is why it's exciting to see Brookfield Infrastructure Corporation (NYSE:BIPC) is about to trade ex-dividend in the next 4 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 important because any transaction on a stock needs to have been settled before the record date in order to be eligible for a dividend. Accordingly, Brookfield Infrastructure investors that purchase the stock on or after the 28th of November will not receive the dividend, which will be paid on the 31st of December.

The company's upcoming dividend is US$0.43 a share, following on from the last 12 months, when the company distributed a total of US$1.72 per share to shareholders. Calculating the last year's worth of payments shows that Brookfield Infrastructure has a trailing yield of 3.9% on the current share price of US$44.29. Dividends are a major contributor to investment returns for long term holders, but only if the dividend continues to be paid. So we need to check whether the dividend payments are covered, and if earnings are growing.

We've found 21 US stocks that are forecast to pay a dividend yield of over 6% next year. See the full list for free.

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. Brookfield Infrastructure reported a loss after tax last year, which means it's paying a dividend despite being unprofitable. While this might be a one-off event, this is unlikely to be sustainable in the long term. Brookfield Infrastructure 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.

Check out our latest analysis for Brookfield Infrastructure

Click here to see how much of its profit Brookfield Infrastructure paid out over the last 12 months.

Have Earnings And Dividends Been Growing?

Businesses with strong growth prospects usually make the best dividend payers, because it's easier to grow dividends when earnings per share are improving. Investors love dividends, so if earnings fall and the dividend is reduced, expect a stock to be sold off heavily at the same time. Brookfield Infrastructure reported a loss last year, but at least the general trend suggests its income has 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.

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, six years ago, Brookfield Infrastructure has lifted its dividend by approximately 4.9% a year on average. Earnings per share have been growing much quicker than dividends, potentially because Brookfield Infrastructure is keeping back more of its profits to grow the business.

Get our latest analysis on Brookfield Infrastructure's balance sheet health here.

Final Takeaway

Has Brookfield Infrastructure got what it takes to maintain its dividend payments? In summary, Brookfield Infrastructure appears to have some promise as a dividend stock, and we'd suggest taking a closer look at it.

While it's tempting to invest in Brookfield Infrastructure for the dividends alone, you should always be mindful of the risks involved. For example, we've found 2 warning signs for Brookfield Infrastructure that we recommend you consider before investing in the business.

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.