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Dividends play a key role in compounding returns over time and can form a large part of our portfolio return. Over the past 10 years, China Aviation Oil (Singapore) Corporation Ltd (SGX:G92) has returned an average of 2.00% per year to shareholders in terms of dividend yield. Let’s dig deeper into whether China Aviation Oil (Singapore) should have a place in your portfolio. Check out our latest analysis for China Aviation Oil (Singapore)
5 checks you should use to assess a dividend stock
If you are a dividend investor, you should always assess these five key metrics:
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Is their annual yield among the top 25% 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 dividend per share risen in the past couple of years?
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Is it able 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 China Aviation Oil (Singapore) pass our checks?
The company currently pays out 33.94% of its earnings as a dividend, according to its trailing twelve-month data, meaning the dividend is sufficiently covered by earnings. However, going forward, analysts expect G92’s payout to fall to 28.49% of its earnings, which leads to a dividend yield of 2.98%. However, EPS should increase to $0.11, meaning that the lower payout ratio does not necessarily implicate a lower dividend payment. If there is one thing that you want to be reliable in your life, it’s dividend stocks and their constant income stream. Whilst its per-share payments have increased during the past 10 years, there has been some hiccups. Investors have seen reductions in the dividend per share in the past, although, it has picked up again. In terms of its peers, China Aviation Oil (Singapore) has a yield of 2.87%, which is on the low-side for Oil and Gas stocks.
Next Steps:
With these dividend metrics in mind, I definitely rank China Aviation Oil (Singapore) as a strong income stock, and is worth further research for anyone who considers dividends an important part of their portfolio strategy. Given that this is purely a dividend analysis, I urge potential investors to try and get a good understanding of the underlying business and its fundamentals before deciding on an investment. I’ve put together three relevant aspects you should further examine:
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Future Outlook: What are well-informed industry analysts predicting for G92’s future growth? Take a look at our free research report of analyst consensus for G92’s outlook.
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Valuation: What is G92 worth today? Even if the stock is a cash cow, it’s not worth an infinite price. The intrinsic value infographic in our free research report helps visualize whether G92 is currently mispriced by the market.
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Other Dividend Rockstars: Are there better dividend payers with stronger fundamentals out there? Check out our free list of these great stocks here.
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned.