Over the past 10 years Gujarat Industries Power Company Limited (NSEI:GIPCL) has returned an average of 3.00% per year from dividend payouts. The stock currently pays out a dividend yield of 2.33%, and has a market cap of IN₨17.51B. Let’s dig deeper into whether Gujarat Industries Power should have a place in your portfolio. Check out our latest analysis for Gujarat Industries Power
Here’s how I find good dividend stocks
If you are a dividend investor, you should always assess these five key metrics:
- Is it paying an annual yield above 75% of dividend payers?
- Has it paid dividend every year without dramatically reducing payout in the past?
- Has it increased its dividend per share amount over the past?
- Can it afford 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 well does Gujarat Industries Power fit our criteria?
Gujarat Industries Power has a trailing twelve-month payout ratio of 17.81%, meaning the dividend is sufficiently covered by earnings. In the near future, analysts are predicting lower payout ratio of 13.40%, leading to a dividend yield of around 2.46%. However, EPS should increase to ₹22.7, meaning that the lower payout ratio does not necessarily implicate a lower dividend payment. 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 GIPCL it has increased its DPS from ₹2 to ₹2.7 in the past 10 years. During this period it has not missed a payment, as one would expect for a company increasing its dividend. This is an impressive feat, which makes GIPCL a true dividend rockstar. Relative to peers, Gujarat Industries Power has a yield of 2.33%, which is on the low-side for Renewable Energy stocks.
Taking into account the dividend metrics, Gujarat Industries Power ticks most of the boxes as a strong dividend investment, putting it in my list of top dividend payers. Given that this is purely a dividend analysis, 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. There are three important aspects you should look at:
- 1. Future Outlook: What are well-informed industry analysts predicting for GIPCL’s future growth? Take a look at our free research report of analyst consensus for GIPCL’s outlook.
- 2. Valuation: What is GIPCL 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 GIPCL is currently mispriced by the market.
- 3. 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.