6 Days Left To Premium Brands Holdings Corporation (TSE:PBH)’s Ex-Dividend Date, Should Investors Buy?
Attention dividend hunters! Premium Brands Holdings Corporation (TSX:PBH) will be distributing its dividend of CA$0.42 per share on the 15 January 2018, and will start trading ex-dividend in 6 days time on the 28 December 2017. Investors looking for higher income-generating stocks to add to their portfolio should keep reading, as I examine Premium Brands Holdings’s latest financial data to analyse its dividend characteristics. See our latest analysis for Premium Brands Holdings
Here’s how I find good dividend stocks
When researching a dividend stock, I always follow the following screening criteria:
Is it the top 25% annual dividend yield payer?
Has its dividend been stable over the past (i.e. no missed payments or significant payout cuts)?
Has dividend per share risen in the past couple of years?
Does earnings amply cover its dividend payments?
Based on future earnings growth, will it be able to continue to payout dividend at the current rate?
Does Premium Brands Holdings pass our checks?
Premium Brands Holdings has a payout ratio of 58.47%, meaning the dividend is sufficiently covered by earnings. However, going forward, analysts expect PBH’s payout to fall to 38.93% of its earnings, which leads to a dividend yield of 1.70%.
Reliablity is an important factor for dividend stocks, particularly for income investors who want a strong track record of payment and a positive outlook for future payout. In the case of PBH it has increased its DPS from CA$1.18 to CA$1.68 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. Compared to its peers, Premium Brands Holdings generates a yield of 1.60%, which is high for food stocks but still below the low risk savings rate.
What this means for you:
Are you a shareholder? With Premium Brands Holdings producing strong dividend income for your portfolio over the past few years, you can take comfort in knowing that this stock will still continue to be a robust dividend generator moving forward. But, depending on your current holdings, it may be valuable exploring other dividend stocks to increase diversification, or even look at high-growth stocks to complement your steady income stocks. I encourage you to continue your research by taking a look at my interactive free list of dividend rockstars as well as high-growth stocks to potentially add to your holdings.
Are you a potential investor? Keeping in mind the dividend characteristics above, Premium Brands Holdings is definitely worth considering for investors looking to build a dedicated income portfolio. As with all investments, 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. Whether or not you like Premium Brands Holdings as a dividend stock, it’s still worth checking the price tag. Can you buy Premium Brands Holdings for a great price? Take a look at our latest free analysis to find out!
To help readers see pass 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.
