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Does Tristel Plc (LON:TSTL) Have A Place In Your Dividend Portfolio?

A sizeable part of portfolio returns can be produced by dividend stocks due to their contribution to compounding returns in the long run. In the past 10 years Tristel Plc (AIM:TSTL) has returned an average of 3.00% per year to investors in the form of dividend payouts. Should it have a place in your portfolio? Let’s take a look at Tristel in more detail. See our latest analysis for Tristel

How I analyze a dividend stock

When researching a dividend stock, I always follow the following screening criteria:

  • Is its annual yield among the top 25% of dividend-paying companies?

  • Has it paid dividend every year without dramatically reducing payout in the past?

  • Has dividend per share risen in the past couple of years?

  • Is its earnings sufficient to payout dividend at the current rate?

  • Will the company be able to keep paying dividend based on the future earnings growth?

AIM:TSTL Historical Dividend Yield Feb 6th 18
AIM:TSTL Historical Dividend Yield Feb 6th 18

How well does Tristel fit our criteria?

The company currently pays out 50.03% of its earnings as a dividend, according to its trailing twelve-month data, meaning the dividend is sufficiently covered by earnings. Going forward, analysts expect TSTL’s payout to remain around the same level at 52.13% of its earnings, which leads to a dividend yield of 1.86%. In addition to this, EPS should increase to £0.08. If dividend is a key criteria in your investment consideration, then you need to make sure the dividend stock you’re eyeing out is reliable in its payments. Whilst its per-share payments have increased during the past 10 years, there has been some hiccups. Shareholders would have seen a few years of reduced payments in this time. Relative to peers, Tristel generates a yield of 1.60%, which is high for Medical Equipment stocks but still below the low risk savings rate.

Next Steps:

If you are building an income portfolio, then Tristel is a complicated choice since it has some positive aspects as well as negative ones. But if you are not exclusively a dividend investor, the stock could still be an interesting investment opportunity. 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. I’ve put together three fundamental aspects you should further examine:


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.

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