If you are interested in cashing in on Mazda Limited’s (NSE:MAZDALTD) upcoming dividend of ₹8.10 per share, you only have 2 days left to buy the shares before its ex-dividend date, 14 August 2018, in time for dividends payable on the 04 October 2018. Investors looking for higher income-generating stocks to add to their portfolio should keep reading, as I examine Mazda’s latest financial data to analyse its dividend characteristics.
Check out our latest analysis for Mazda
5 checks you should do on a dividend stock
When researching a dividend stock, I always follow the following screening criteria:
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Is it the top 25% annual dividend yield payer?
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Does it consistently pay out dividends without missing a payment of significantly cutting payout?
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Has it increased its dividend per share amount over the past?
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Is its earnings sufficient to payout dividend at the current rate?
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Will it be able to continue to payout at the current rate in the future?
How well does Mazda fit our criteria?
The company currently pays out 33.50% of its earnings as a dividend, according to its trailing twelve-month data, meaning the dividend is sufficiently 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 there is one thing that you want to be reliable in your life, it’s dividend stocks and their constant income stream. In the case of MAZDALTD it has increased its DPS from ₹1.5 to ₹8.1 in the past 10 years. During this period it has not missed a payment, as one would expect for a company increasing its dividend. These are all positive signs of a great, reliable dividend stock.
Relative to peers, Mazda has a yield of 2.23%, which is high for Machinery stocks.
Next Steps:
Keeping in mind the dividend characteristics above, Mazda is definitely worth considering for investors looking to build a dedicated income portfolio. 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 relevant factors you should further examine:
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Future Outlook: What are well-informed industry analysts predicting for MAZDALTD’s future growth? Take a look at our free research report of analyst consensus for MAZDALTD’s outlook.
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Valuation: What is MAZDALTD 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 MAZDALTD 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 past 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. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.