If you are interested in cashing in on Randgold Resources Limited’s (LSE:RRS) upcoming dividend of $2 per share, you only have 7 days left to buy the shares before its ex-dividend date, 22 March 2018, in time for dividends payable on the 18 May 2018. Should you diversify into Randgold Resources and boost your portfolio income stream? Well, keep on reading because today, I’m going to look at the latest data and analyze the stock and its dividend property in further detail. View our latest analysis for Randgold Resources
Here’s how I find good dividend stocks
If you are a dividend investor, you should always assess these five key metrics:
- Does it pay an annual yield higher than 75% of dividend payers?
- Has it paid dividend every year without dramatically reducing payout in the past?
- Has the amount of dividend per share grown 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 Randgold Resources fit our criteria?
Randgold Resources has a trailing twelve-month payout ratio of 67.66%, meaning the dividend is sufficiently covered by earnings. In the near future, analysts are predicting a higher payout ratio of 104.55%, leading to a dividend yield of around 4.43%. Furthermore, EPS should increase to $3.66. The higher payout forecasted, along with higher earnings, should lead to greater dividend income for investors moving forward. However this does bring about uncertainty around the sustainability of the payout ratio. If there is one thing that you want to be reliable in your life, it’s dividend stocks and their constant income stream. RRS has increased its DPS from $0.06 to $1.42 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 RRS a true dividend rockstar. Compared to its peers, Randgold Resources generates a yield of 2.35%, which is on the low-side for Metals and Mining stocks.
Keeping in mind the dividend characteristics above, Randgold Resources 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 relevant factors you should further research:
- Future Outlook: What are well-informed industry analysts predicting for RRS’s future growth? Take a look at our free research report of analyst consensus for RRS’s outlook.
- Valuation: What is RRS 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 RRS 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.