Investors who want to cash in on Charter Hall Long WALE REIT’s (ASX:CLW) upcoming dividend of A$0.13 per share have only 3 days left to buy the shares before its ex-dividend date, 28 December 2017, in time for dividends payable on the 14 February 2018. Investors looking for higher income-generating stocks to add to their portfolio should keep reading, as I take a deeper dive into Charter Hall Long WALE REIT’s latest financial data to analyse its dividend attributes. Check out our latest analysis for Charter Hall Long WALE REIT
How I analyze a dividend stock
When researching a dividend stock, I always follow the following screening criteria:
-
Is their annual yield among the top 25% of dividend payers?
-
Has it consistently paid a stable dividend without missing a payment or drastically cutting payout?
-
Has the amount of dividend per share grown over the past?
-
Is is able to pay the current rate of dividends from its earnings?
-
Based on future earnings growth, will it be able to continue to payout dividend at the current rate?
How does Charter Hall Long WALE REIT fare?
Charter Hall Long WALE REIT has a payout ratio of 30.30%, which means that the dividend is covered by earnings. In the near future, analysts are predicting a higher payout ratio of 99.36%, leading to a dividend yield of around 6.53%. In addition to this, EPS should increase to A$0.27. The higher payout forecasted, along with higher earnings, should lead to greater dividend income for investors moving forward. However this does bring about uncertainty around the sustainability of the payout ratio. If there’s one type of stock you want to be reliable, it’s dividend stocks and their stable income-generating ability. The reality is that it is too early to consider Charter Hall Long WALE REIT 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, Charter Hall Long WALE REIT has a yield of 2.74%, which is on the low-side for reits stocks.
What this means for you:
Are you a shareholder? You may be wondering why Charter Hall Long WALE REIT is paying out dividends at all, instead of re-investing into the business to generate higher cash flows in the future. It may be beneficial exploring other dividend stocks as alternatives to Charter Hall Long WALE REIT or even look at high-growth stocks to complement your steady income stocks. I encourage you to continue your research by exploring my interactive free list of dividend rockstars as well as high-growth stocks to potentially add to your holdings.