It looks like Vitreous Glass Inc. (CVE:VCI) is about to go ex-dividend in the next 3 days. Investors can purchase shares before the 30th of January in order to be eligible for this dividend, which will be paid on the 14th of February.
Vitreous Glass's next dividend payment will be CA$0.12 per share. Last year, in total, the company distributed CA$0.31 to shareholders. Looking at the last 12 months of distributions, Vitreous Glass has a trailing yield of approximately 8.2% on its current stock price of CA$3.65. If you buy this business for its dividend, you should have an idea of whether Vitreous Glass's dividend is reliable and sustainable. As a result, readers should always check whether Vitreous Glass has been able to grow its dividends, or if the dividend might be cut.
Dividends are usually paid out of company profits, so if a company pays out more than it earned then its dividend is usually at greater risk of being cut.
Have Earnings And Dividends Been Growing?
Companies with falling earnings are riskier for dividend shareholders. If earnings decline and the company is forced to cut its dividend, investors could watch the value of their investment go up in smoke. So we're not too excited that Vitreous Glass's earnings are down 2.9% 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. Vitreous Glass has delivered 2.3% dividend growth per year on average over the past ten years.
To Sum It Up
Has Vitreous Glass got what it takes to maintain its dividend payments? Vitreous Glass'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. Vitreous Glass 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.
Want to learn more about Vitreous Glass? Here's a visualisation of its historical rate of revenue and earnings growth.
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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