Have you been keeping an eye on Vicinity Centres’s (ASX:VCX) upcoming dividend of A$0.08 per share payable on the 28 February 2018? Then you only have 3 days left before the stock starts trading ex-dividend on the 28 December 2017. Investors looking for higher income-generating stocks to add to their portfolio should keep reading, as I examine Vicinity Centres’s latest financial data to analyse its dividend characteristics. Check out our latest analysis for Vicinity Centres
Here’s how I find good dividend stocks
If you are a dividend investor, you should always assess these five key metrics:
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Does it pay an annual yield higher than 75% of dividend payers?
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Does it consistently pay out dividends without missing a payment of significantly cutting payout?
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Has it increased its dividend per share amount over the past?
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Can it afford to pay the current rate of dividends from its earnings?
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Based on future earnings growth, will it be able to continue to payout dividend at the current rate?
Does Vicinity Centres pass our checks?
The company currently pays out 43.25% of its earnings as a dividend, meaning the dividend is sufficiently covered by earnings. Going forward, analysts expect VCX’s payout to increase to 87.59% of its earnings, which leads to a dividend yield of 6.03%. However, EPS is forecasted to fall to A$0.18 in the upcoming year. Therefore, although payout is expected to increase, the fall in earnings may not equate to higher dividend income. If there is one thing that you want to be reliable in your life, it’s dividend stocks and their constant income stream. The reality is that it is too early to consider Vicinity Centres as a dividend investment. It has only been consistently paying dividends for 3 years, however, standard practice for reliable payers is to look for a 10-year minimum track record. Compared to its peers, Vicinity Centres produces a yield of 6.22%, which is high for reits stocks.
What this means for you:
Are you a shareholder? With Vicinity Centres producing strong dividend income for your portfolio over the past few years, you can take comfort in knowing that this stock will still continue to be a robust dividend generator moving forward. However, depending on your current portfolio, it may be valuable exploring other income stocks to improve your diversification, or even look at high-growth stocks to complement your steady income stocks. I recommend continuing your research by taking a look at my interactive free list of dividend rockstars as well as high-growth stocks to potentially add to your holdings.