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If you are interested in cashing in on Allied Properties (H.K.) Limited's (HKG:56) upcoming dividend of HK$0.08 per share, you only have 4 days left to buy the shares before its ex-dividend date, 08 April 2019, in time for dividends payable on the 02 May 2019. Investors looking for higher income-generating stocks to add to their portfolio should keep reading, as I take a deeper dive into Allied Properties (H.K.)'s latest financial data to analyse its dividend attributes.
View our latest analysis for Allied Properties (H.K.)
5 checks you should use to assess a dividend stock
When researching a dividend stock, I always follow the following screening criteria:
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Is its annual yield among the top 25% of dividend-paying companies?
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Has its dividend been stable over the past (i.e. no missed payments or significant payout cuts)?
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Has dividend per share amount increased over the past?
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Is is able to pay the current rate of dividends from its earnings?
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Will the company be able to keep paying dividend based on the future earnings growth?
Does Allied Properties (H.K.) pass our checks?
Allied Properties (H.K.) has a trailing twelve-month payout ratio of 23%, meaning the dividend is sufficiently covered by earnings. Furthermore, analysts have not forecasted a dividends per share for the future, which makes it hard to determine the yield shareholders should expect, and whether the current payout is sustainable, moving forward.
When thinking about whether a dividend is sustainable, another factor to consider is the cash flow. A business with strong cash flow can sustain a higher divided payout ratio than a company with weak cash flow.
If there is one thing that you want to be reliable in your life, it's dividend stocks and their constant income stream. Although 56's per share payments have increased in the past 10 years, it has not been a completely smooth ride. Investors have seen reductions in the dividend per share in the past, although, it has picked up again.
In terms of its peers, Allied Properties (H.K.) produces a yield of 4.2%, which is on the low-side for Consumer Finance stocks.
Next Steps:
If you are building an income portfolio, then Allied Properties (H.K.) is a complicated choice since it has some positive aspects as well as negative ones. But if you are not exclusively a dividend investor, the stock could still be an interesting investment opportunity. Given that this is purely a dividend analysis, I recommend taking sufficient time to understand its core business and determine whether the company and its investment properties suit your overall goals. I've put together three fundamental aspects you should further research: