Readers hoping to buy Crombie Real Estate Investment Trust (TSE:CRR.UN) for its dividend will need to make their move shortly, as the stock is about to trade ex-dividend. You will need to purchase shares before the 30th of July to receive the dividend, which will be paid on the 15th of August.
Crombie Real Estate Investment Trust's next dividend payment will be CA$0.074 per share, and in the last 12 months, the company paid a total of CA$0.89 per share. Calculating the last year's worth of payments shows that Crombie Real Estate Investment Trust has a trailing yield of 5.7% on the current share price of CA$15.55. Dividends are an important source of income to many shareholders, but the health of the business is crucial to maintaining those dividends. We need to see whether the dividend is covered by earnings and if it's growing.
If a company pays out more in dividends than it earned, then the dividend might become unsustainable - hardly an ideal situation. Last year, Crombie Real Estate Investment Trust paid out 104% of its income as dividends, which is above a level that we're comfortable with, especially if the company needs to reinvest in its business. While Crombie Real Estate Investment Trust seems to be paying out a very high percentage of its income, REITs have different dividend payment behaviour and so, while we don't think this is great, we also don't think it is unusual.
Have Earnings And Dividends Been Growing?
Companies with consistently growing earnings per share generally make the best dividend stocks, as they usually find it easier to grow dividends per share. If business enters a downturn and the dividend is cut, the company could see its value fall precipitously. Fortunately for readers, Crombie Real Estate Investment Trust's earnings per share have been growing at 18% a year for the past five years.
Many investors will assess a company's dividend performance by evaluating how much the dividend payments have changed over time. It looks like the Crombie Real Estate Investment Trust dividends are largely the same as they were ten years ago.
Is Crombie Real Estate Investment Trust worth buying for its dividend? It's good to see earnings per share growing and low cashflow payout ratio, although we're uncomfortable with Crombie Real Estate Investment Trust's paying out such a high percentage of its profit. Overall, it's not a bad combination, but we feel that there are likely more attractive dividend prospects out there.
Wondering what the future holds for Crombie Real Estate Investment Trust? See what the two analysts we track are forecasting, with this visualisation of its historical and future estimated earnings and cash flow
If you're in the market for dividend stocks, we recommend checking our list of top dividend stocks with a greater than 2% yield and an upcoming dividend.
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