Regular readers will know that we love our dividends at Simply Wall St, which is why it's exciting to see Hellenic Exchanges - Athens Stock Exchange SA (ATH:EXAE) is about to trade ex-dividend in the next 3 days. Ex-dividend means that investors that purchase the stock on or after the 5th of August will not receive this dividend, which will be paid on the 12th of August.
Hellenic Exchanges - Athens Stock Exchange's next dividend payment will be €0.11 per share, and in the last 12 months, the company paid a total of €0.16 per share. Last year's total dividend payments show that Hellenic Exchanges - Athens Stock Exchange has a trailing yield of 3.2% on the current share price of €4.955. If you buy this business for its dividend, you should have an idea of whether Hellenic Exchanges - Athens Stock Exchange's dividend is reliable and sustainable. As a result, readers should always check whether Hellenic Exchanges - Athens Stock Exchange has been able to grow its dividends, or if the dividend might be cut.
Check out our latest analysis for Hellenic Exchanges - Athens Stock Exchange
Dividends are usually paid out of company profits, so if a company pays out more than it earned then its dividend is usually at greater risk of being cut. Hellenic Exchanges - Athens Stock Exchange paid out 120% of profit in the past year, which we think is typically not sustainable unless there are mitigating characteristics such as unusually strong cash flow or a large cash balance.
Generally, the higher a company's payout ratio, the more the dividend is at risk of being reduced.
Click here to see the company's payout ratio, plus analyst estimates of its future dividends.
Have Earnings And Dividends Been Growing?
Companies with falling earnings are riskier for dividend shareholders. If earnings decline and the company is forced to cut its dividend, investors could watch the value of their investment go up in smoke. Hellenic Exchanges - Athens Stock Exchange's earnings per share have plummeted approximately 39% a year over the previous five years.
Another key way to measure a company's dividend prospects is by measuring its historical rate of dividend growth. Hellenic Exchanges - Athens Stock Exchange's dividend payments per share have declined at 14% per year on average over the past 10 years, which is uninspiring. While it's not great that earnings and dividends per share have fallen in recent years, we're encouraged by the fact that management has trimmed the dividend rather than risk over-committing the company in a risky attempt to maintain yields to shareholders.