Just 3 Days Before Universal Logistics Holdings, Inc. (NASDAQ:ULH) Will Be Trading Ex-Dividend
Readers hoping to buy Universal Logistics Holdings, Inc. (NASDAQ:ULH) for its dividend will need to make their move shortly, as the stock is about to trade ex-dividend. Investors can purchase shares before the 28th of February in order to be eligible for this dividend, which will be paid on the 6th of April.
Universal Logistics Holdings's upcoming dividend is US$0.10 a share, following on from the last 12 months, when the company distributed a total of US$0.42 per share to shareholders. Calculating the last year's worth of payments shows that Universal Logistics Holdings has a trailing yield of 2.2% on the current share price of $18.72. Dividends are an important source of income to many shareholders, but the health of the business is crucial to maintaining those dividends. That's why we should always check whether the dividend payments appear sustainable, and if the company is growing.
View our latest analysis for Universal Logistics Holdings
Dividends are typically paid from company earnings. If a company pays more in dividends than it earned in profit, then the dividend could be unsustainable. That's why it's good to see Universal Logistics Holdings paying out a modest 31% of its earnings.
Click here to see the company's payout ratio, plus analyst estimates of its future dividends.
Have Earnings And Dividends Been Growing?
When earnings decline, dividend companies become much harder to analyse and own safely. Investors love dividends, so if earnings fall and the dividend is reduced, expect a stock to be sold off heavily at the same time. So we're not too excited that Universal Logistics Holdings's earnings are down 2.4% a year over the past five years.
The main way most investors will assess a company's dividend prospects is by checking the historical rate of dividend growth. Universal Logistics Holdings has seen its dividend decline 10% per annum on average over the past eight years, which is not great to see. While it's not great that earnings and dividends per share have fallen in recent years, we're encouraged by the fact that management has trimmed the dividend rather than risk over-committing the company in a risky attempt to maintain yields to shareholders.
To Sum It Up
Is Universal Logistics Holdings an attractive dividend stock, or better left on the shelf? Universal Logistics Holdings's earnings per share are down over the past five years, although it has the cushion of a low payout ratio, which would suggest a cut to the dividend is relatively unlikely. Universal Logistics Holdings ticks a lot of boxes for us from a dividend perspective, and we think these characteristics should mark the company as deserving of further attention.
Curious what other investors think of Universal Logistics Holdings? See what analysts are forecasting, with this visualisation of its historical and future estimated earnings and cash flow.
A common investment mistake is buying the first interesting stock you see. Here you can find a list of promising dividend stocks with a greater than 2% yield and an upcoming dividend.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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.
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