It looks like Dahlbusch Ag (BST:DAL) is about to go ex-dividend in the next 4 days. Investors can purchase shares before the 22nd of November in order to be eligible for this dividend, which will be paid on the 26th of November.
Dahlbusch Ag's next dividend payment will be €16.04 per share, and in the last 12 months, the company paid a total of €19.06 per share. Looking at the last 12 months of distributions, Dahlbusch Ag has a trailing yield of approximately 5.2% on its current stock price of €370. If you buy this business for its dividend, you should have an idea of whether Dahlbusch Ag's dividend is reliable and sustainable. So we need to check whether the dividend payments are covered, and if earnings are growing.
Dividends are usually paid out of company profits, so if a company pays out more than it earned then its dividend is usually at greater risk of being cut. Dahlbusch Ag paid a dividend last year despite being unprofitable. This might be a one-off event, but it's not a sustainable state of affairs in the long run.
Have Earnings And Dividends Been Growing?
Businesses with strong growth prospects usually make the best dividend payers, because it's easier to grow dividends when earnings per share are improving. If earnings decline and the company is forced to cut its dividend, investors could watch the value of their investment go up in smoke. Dahlbusch Ag reported a loss last year, but at least the general trend suggests its income has been improving over the past five years. Even so, an unprofitable company whose business does not quickly recover is usually not a good candidate for dividend investors.
The main way most investors will assess a company's dividend prospects is by checking the historical rate of dividend growth. It looks like the Dahlbusch Ag dividends are largely the same as they were four years ago.
We update our analysis on Dahlbusch Ag every 24 hours, so you can always get the latest insights on its financial health, here.
The Bottom Line
Should investors buy Dahlbusch Ag for the upcoming dividend? We're unconvinced on the company's merits, and think there might be better opportunities out there.
Keen to explore more data on Dahlbusch Ag's financial performance? Check out our visualisation of its historical revenue and earnings growth.
We wouldn't recommend just buying the first dividend stock you see, though. Here's a list of interesting dividend stocks with a greater than 2% yield and an upcoming dividend.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.