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If you are interested in cashing in on Great Eagle Holdings Limited’s (HKG:41) upcoming dividend of HK$0.33 per share, you only have 4 days left to buy the shares before its ex-dividend date, 27 September 2018, in time for dividends payable on the 19 October 2018. Investors looking for higher income-generating stocks to add to their portfolio should keep reading, as I examine Great Eagle Holdings’s latest financial data to analyse its dividend characteristics.

See our latest analysis for Great Eagle Holdings

5 checks you should use to assess a dividend stock

Whenever I am looking at a potential dividend stock investment, I always check these five metrics:

• Is its annual yield among the top 25% of dividend-paying companies?

• Has its dividend been stable over the past (i.e. no missed payments or significant payout cuts)?

• Has the amount of dividend per share grown over the past?

• Can it afford to pay the current rate of dividends from its earnings?

• Will it have the ability to keep paying its dividends going forward?

How well does Great Eagle Holdings fit our criteria?

The company currently pays out 6.5% of its earnings as a dividend, according to its trailing twelve-month data, which means that the dividend is 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 assessing the forecast sustainability of a dividend it is also worth considering the cash flow of the business. A business with strong cash flow can sustain a higher divided payout ratio than a company with weak cash flow.

If dividend is a key criteria in your investment consideration, then you need to make sure the dividend stock you’re eyeing out is reliable in its payments. 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.

Compared to its peers, Great Eagle Holdings produces a yield of 3.2%, which is on the low-side for Real Estate stocks.

Next Steps:

Whilst there are few things you may like about Great Eagle Holdings from a dividend stock perspective, the truth is that overall it probably is not the best choice for a dividend investor. 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 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 essential factors you should further examine: