Yahoo Finance Pan-United's (SGX:P52) Dividend Will Be SGD0.018
The board of Pan-United Corporation Ltd (SGX:P52) has announced that it will pay a dividend on the 17th of May, with investors receiving SGD0.018 per share. Based on this payment, the dividend yield will be 5.2%, which is fairly typical for the industry.
See our latest analysis for Pan-United
Pan-United's Earnings Easily Cover The Distributions
We aren't too impressed by dividend yields unless they can be sustained over time. Prior to this announcement, Pan-United's dividend was comfortably covered by both cash flow and earnings. This indicates that quite a large proportion of earnings is being invested back into the business.
Looking forward, earnings per share is forecast to rise by 9.4% over the next year. Assuming the dividend continues along recent trends, we think the payout ratio could be 35% by next year, which is in a pretty sustainable range.
Dividend Volatility
Although the company has a long dividend history, it has been cut at least once in the last 10 years. Since 2014, the dividend has gone from SGD0.04 total annually to SGD0.023. This works out to be a decline of approximately 5.4% per year over that time. Declining dividends isn't generally what we look for as they can indicate that the company is running into some challenges.
The Dividend Looks Likely To Grow
Given that the track record hasn't been stellar, we really want to see earnings per share growing over time. Pan-United has seen EPS rising for the last five years, at 43% per annum. Pan-United is clearly able to grow rapidly while still returning cash to shareholders, positioning it to become a strong dividend payer in the future.
Pan-United Looks Like A Great Dividend Stock
Overall, we like to see the dividend staying consistent, and we think Pan-United might even raise payments in the future. Distributions are quite easily covered by earnings, which are also being converted to cash flows. Taking this all into consideration, this looks like it could be a good dividend opportunity.
Market movements attest to how highly valued a consistent dividend policy is compared to one which is more unpredictable. Still, investors need to consider a host of other factors, apart from dividend payments, when analysing a company. For example, we've picked out 1 warning sign for Pan-United that investors should know about before committing capital to this stock. Is Pan-United 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.
