Bridgemarq Real Estate Services (TSE:BRE) Is Due To Pay A Dividend Of CA$0.1125
Bridgemarq Real Estate Services Inc.'s (TSE:BRE) investors are due to receive a payment of CA$0.1125 per share on 29th of September. The dividend yield will be 9.3% based on this payment which is still above the industry average.
View our latest analysis for Bridgemarq Real Estate Services
Bridgemarq Real Estate Services Doesn't Earn Enough To Cover Its Payments
A big dividend yield for a few years doesn't mean much if it can't be sustained. Before making this announcement, the company's dividend was much higher than its earnings. Without profits and cash flows increasing, it would be difficult for the company to continue paying the dividend at this level.
If the company can't turn things around, EPS could fall by 18.8% over the next year. If the dividend continues along recent trends, we estimate the payout ratio could reach 1,196%, which could put the dividend in jeopardy if the company's earnings don't improve.
Bridgemarq Real Estate Services Has A Solid Track Record
The company has a sustained record of paying dividends with very little fluctuation. Since 2013, the annual payment back then was CA$1.1, compared to the most recent full-year payment of CA$1.35. This implies that the company grew its distributions at a yearly rate of about 2.0% over that duration. Slow and steady dividend growth might not sound that exciting, but dividends have been stable for ten years, which we think makes this a fairly attractive offer.
Dividend Growth Potential Is Shaky
Some investors will be chomping at the bit to buy some of the company's stock based on its dividend history. However, initial appearances might be deceiving. Over the past five years, it looks as though Bridgemarq Real Estate Services' EPS has declined at around 19% a year. Such rapid declines definitely have the potential to constrain dividend payments if the trend continues into the future.
Bridgemarq Real Estate Services' Dividend Doesn't Look Sustainable
Overall, it's nice to see a consistent dividend payment, but we think that longer term, the current level of payment might be unsustainable. We can't deny that the payments have been very stable, but we are a little bit worried about the very high payout ratio. We don't think Bridgemarq Real Estate Services is a great stock to add to your portfolio if income is your focus.
Investors generally tend to favour companies with a consistent, stable dividend policy as opposed to those operating an irregular one. Meanwhile, despite the importance of dividend payments, they are not the only factors our readers should know when assessing a company. Case in point: We've spotted 5 warning signs for Bridgemarq Real Estate Services (of which 4 can't be ignored!) you should know about. If you are a dividend investor, you might also want to look at our curated list of high yield dividend stocks.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
