Shares of China Industrial Securities International Financial Group Limited (SEHK:8407) will begin trading ex-dividend in 2 days. To qualify for the dividend check of HK$0.03 per share, investors must have owned the shares prior to 10 May 2018, which is the last day the company’s management will finalize their list of shareholders to which they will send dividend payments. Investors looking for higher income-generating stocks to add to their portfolio should keep reading, as I take a deeper dive into China Industrial Securities International Financial Group’s latest financial data to analyse its dividend attributes. See our latest analysis for China Industrial Securities International Financial Group
How I analyze a dividend stock
When researching a dividend stock, I always follow the following screening criteria:
-
Does it pay an annual yield higher than 75% of dividend payers?
-
Does it consistently pay out dividends without missing a payment of significantly cutting payout?
-
Has dividend per share amount increased over the past?
-
Is is able to pay the current rate of dividends from its earnings?
-
Will it be able to continue to payout at the current rate in the future?
How does China Industrial Securities International Financial Group fare?
The current trailing twelve-month payout ratio for the stock is 75.22%, 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. 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. Unfortunately, it is really too early to view China Industrial Securities International Financial Group 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, China Industrial Securities International Financial Group has a yield of 2.42%, which is on the low-side for Capital Markets stocks.
Next Steps:
Now you know to keep in mind the reason why investors should be careful investing in China Industrial Securities International Financial Group for the dividend. 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, 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 further research: