Investors who want to cash in on Consolidated Water Co Ltd’s (NASDAQ:CWCO) upcoming dividend of US$0.085 per share have only 2 days left to buy the shares before its ex-dividend date, 29 June 2018, in time for dividends payable on the 31 July 2018. Is this future income a persuasive enough catalyst for investors to think about Consolidated Water as an investment today? Below, I’m going to look at the latest data and analyze the stock and its dividend property in further detail. See our latest analysis for Consolidated Water
5 questions to ask before buying a dividend stock
Whenever I am looking at a potential dividend stock investment, I always check these five metrics:
- Is it paying an annual yield above 75% 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?
- Can it afford 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 well does Consolidated Water fit our criteria?
Consolidated Water has a trailing twelve-month payout ratio of 85.34%, 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 CWCO it has increased its DPS from $0.26 to $0.34 in the past 10 years. It has also been paying out dividend consistently during this time, as you’d expect for a company increasing its dividend levels. This is an impressive feat, which makes CWCO a true dividend rockstar.
In terms of its peers, Consolidated Water has a yield of 2.63%, which is on the low-side for Water Utilities stocks.
Keeping in mind the dividend characteristics above, Consolidated Water is definitely worth considering for investors looking to build a dedicated income portfolio. Given that this is purely a dividend analysis, I recommend taking sufficient time to understand its core business and determine whether the company and its investment properties suit your overall goals. Below, I’ve compiled three important factors you should look at:
- Future Outlook: What are well-informed industry analysts predicting for CWCO’s future growth? Take a look at our free research report of analyst consensus for CWCO’s outlook.
- Valuation: What is CWCO 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 CWCO is currently mispriced by the market.
- 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 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.