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Important news for shareholders and potential investors in JNBY Design Limited (HKG:3306): The dividend payment of CN¥0.46 per share will be distributed to shareholders on 05 November 2018, and the stock will begin trading ex-dividend at an earlier date, 25 October 2018. Investors looking for higher income-generating stocks to add to their portfolio should keep reading, as I take a deeper dive into JNBY Design’s latest financial data to analyse its dividend attributes.
View our latest analysis for JNBY Design
How I analyze a dividend stock
Whenever I am looking at a potential dividend stock investment, I always check these five metrics:
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Is it paying an annual yield above 75% of dividend payers?
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Has it consistently paid a stable dividend without missing a payment or drastically cutting payout?
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Has dividend per share risen in the past couple of years?
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Does earnings amply cover its dividend payments?
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Based on future earnings growth, will it be able to continue to payout dividend at the current rate?
How well does JNBY Design fit our criteria?
JNBY Design has a trailing twelve-month payout ratio of 74%, meaning the dividend is sufficiently covered by earnings. In the near future, analysts are predicting a payout ratio of 73%, leading to a dividend yield of around 7.2%. Moreover, EPS should increase to CN¥0.95.
If you want to dive deeper into the sustainability of a certain payout ratio, you may wish to consider the cash flow of the business. Companies with strong cash flow can sustain a higher payout ratio, while companies with weaker cash flow generally cannot.
If there’s one type of stock you want to be reliable, it’s dividend stocks and their stable income-generating ability. Unfortunately, it is really too early to view JNBY Design as a dividend investment. Last year was the company’s first dividend payment, so it is certainly early days. The standard practice for reliable payers is to look for 10 or so years of track record.
Compared to its peers, JNBY Design has a yield of 6.5%, which is high for Luxury stocks.
Next Steps:
With these dividend metrics in mind, I definitely rank JNBY Design 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, you should always research extensively before deciding whether or not a stock is an appropriate investment for you. I always recommend analysing the company’s fundamentals and underlying business before making an investment decision. I’ve put together three fundamental aspects you should look at: