It looks like CPH Chemie + Papier Holding AG (VTX:CPHN) is about to go ex-dividend in the next 4 days. The ex-dividend date is one business day before a company's record date, which is the date on which the company determines which shareholders are entitled to receive a dividend. The ex-dividend date is important as the process of settlement involves two full business days. So if you miss that date, you would not show up on the company's books on the record date. Meaning, you will need to purchase CPH Chemie + Papier Holding's shares before the 22nd of March to receive the dividend, which will be paid on the 26th of March.
The company's upcoming dividend is CHF04.00 a share, following on from the last 12 months, when the company distributed a total of CHF4.00 per share to shareholders. Calculating the last year's worth of payments shows that CPH Chemie + Papier Holding has a trailing yield of 4.8% on the current share price of CHF084.00. Dividends are an important source of income to many shareholders, but the health of the business is crucial to maintaining those dividends. As a result, readers should always check whether CPH Chemie + Papier Holding has been able to grow its dividends, or if the dividend might be cut.
See our latest analysis for CPH Chemie + Papier Holding
If a company pays out more in dividends than it earned, then the dividend might become unsustainable - hardly an ideal situation. Fortunately CPH Chemie + Papier Holding's payout ratio is modest, at just 30% of profit. A useful secondary check can be to evaluate whether CPH Chemie + Papier Holding generated enough free cash flow to afford its dividend. Thankfully its dividend payments took up just 36% of the free cash flow it generated, which is a comfortable payout ratio.
It's positive to see that CPH Chemie + Papier Holding's dividend is covered by both profits and cash flow, since this is generally a sign that the dividend is sustainable, and a lower payout ratio usually suggests a greater margin of safety before the dividend gets cut.
Click here to see the company's payout ratio, plus analyst estimates of its future dividends.
Have Earnings And Dividends Been Growing?
Companies with consistently growing earnings per share generally make the best dividend stocks, as they usually find it easier to grow dividends per share. If earnings fall far enough, the company could be forced to cut its dividend. For this reason, we're glad to see CPH Chemie + Papier Holding's earnings per share have risen 13% per annum over the last five years. Earnings per share are growing rapidly and the company is keeping more than half of its earnings within the business; an attractive combination which could suggest the company is focused on reinvesting to grow earnings further. Fast-growing businesses that are reinvesting heavily are enticing from a dividend perspective, especially since they can often increase the payout ratio later.