Does Haitai Confectionery & Meals Co., ltd. (KRX: 101530) A beautiful dividend inventory?
Dividend paying shares like Haitai Confectionery & Meals Co., Ltd. (KRX: 101530) are typically fashionable with traders, and for good cause – some analysis means that a good portion of all inventory returns comes from reinvesting dividends. If you happen to hope to reside off dividend revenue, you will need to be a lot stricter together with your investments than the common bettor.
Haitai Confectionery & Foodsltd has solely been paying a dividend for a couple of yr, so traders is perhaps interested by its 1.8% return. When shopping for shares for his or her dividends, it is best to all the time undergo the checks under to see if the dividend appears sustainable.
Discover this interactive board for our newest evaluation on Haitai Confectionery & Foodsltd!
Dividends are usually paid out of the corporate’s earnings. If a enterprise pays greater than it earns, then the dividend can turn out to be unsustainable – hardly a great scenario. Evaluating dividend funds to an organization’s after-tax internet revenue is a straightforward technique to take a look at real-life whether or not a dividend is sustainable. Though Haitai Confectionery & Foodsltd pays a dividend, it has been in deficit over the previous yr. When an organization is in deficit, we then must verify whether or not its money circulate can help the dividend.
Haitai Confectionery & Foodsltd’s money payout ratio final yr was 7.3%. Money circulate is often erratic, however it appears like a cautious cost.
We replace our knowledge on Haitai Confectionery & Foodsltd each 24 hours, so you’ll be able to all the time get our newest evaluation of its monetary well being, right here.
Earlier than shopping for a inventory for revenue, we need to see if dividends have been steady up to now and if the corporate has a historical past of sustaining its dividend. This firm has been paying a dividend for lower than 2 years, which appears too early to contemplate it a dependable dividend inventory. Its final annual dividend was 150 ₩ per share.
It is good to see a minimum of some dividend development. But with a comparatively quick dividend payout historical past, we would not need to rely too closely on this dividend.
Potential for dividend development
The opposite half of the dividend funding equation assesses whether or not earnings per share (EPS) is rising. Over the long run, dividends should develop at or above the speed of inflation, so as to keep the buying energy of the recipient. Over the previous 5 years, it seems that Haitai Confectionery & Foodsltd’s BPA has declined by round 68% per yr. A pointy drop in earnings per share is not horrible from a dividend standpoint, as even conservative payout ratios will be underneath strain if earnings fall sufficient.
Once we have a look at a dividend-paying inventory, we have to make a judgment as as to whether the dividend will enhance, whether or not the corporate is ready to maintain it underneath a variety of financial circumstances, and whether or not the dividend cost is sustainable. We do not need Haitai Confectionery & Foodsltd to pay dividends regardless of a loss up to now yr, though fortunately its dividend was coated by money circulate. Earnings per share are down and the corporate has a comparatively quick dividend historical past – shorter than we like, anyway. General, Haitai Confectionery & Foodsltd falls quick in a number of key areas right here. Except the investor has robust causes for another conclusion, we discover it arduous to be excited by a dividend-paying inventory with these traits.
Market actions attest to the excessive worth of a coherent dividend coverage in comparison with a extra unpredictable coverage. Nonetheless, there are different issues for traders to contemplate when analyzing the efficiency of shares. For instance, we’ve got recognized 3 warning indicators for Haitai Confectionery & Foodsltd (2 do not sit too nicely with us!) Which try to be conscious of earlier than investing.
If you happen to’re a dividend investor, you may additionally need to try our curated listing of dividend-paying shares which have a yield above 3%.
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