Should Lung Kee (Bermuda) Holdings Limited (HKG:255) Be Part Of Your Dividend Portfolio?
Dividends play an important role in compounding returns in the long run and end up forming a sizeable part of investment returns. Lung Kee (Bermuda) Holdings Limited (SEHK:255) has returned to shareholders over the past 10 years, an average dividend yield of 8.00% annually. Does Lung Kee (Bermuda) Holdings tick all the boxes of a great dividend stock? Below, I’ll take you through my analysis. Check out our latest analysis for Lung Kee (Bermuda) Holdings
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?
Does it consistently pay out dividends without missing a payment of significantly cutting payout?
Has dividend per share amount increased over the past?
Can it afford to pay the current rate of dividends from its earnings?
Will it have the ability to keep paying its dividends going forward?
Does Lung Kee (Bermuda) Holdings pass our checks?
Lung Kee (Bermuda) Holdings has a trailing twelve-month payout ratio of 56.70%, meaning the dividend is sufficiently covered by earnings. Furthermore, analysts have not forecasted a dividends per share for the future, which makes it hard to determine the yield shareholders should expect, and whether the current payout is sustainable, moving forward. If there is one thing that you want to be reliable in your life, it’s dividend stocks and their constant income stream. Although 255’s per share payments have increased in the past 10 years, it has not been a completely smooth ride. Investors have seen reductions in the dividend per share in the past, although, it has picked up again. In terms of its peers, Lung Kee (Bermuda) Holdings has a yield of 12.26%, which is high for Machinery stocks.
Next Steps:
Keeping in mind the dividend characteristics above, Lung Kee (Bermuda) Holdings is definitely worth considering for investors looking to build a dedicated income portfolio. Given that this is purely a dividend analysis, you should always research extensively before deciding whether or not a stock is an appropriate investment for you. I always recommend analysing the company’s fundamentals and underlying business before making an investment decision. Below, I’ve compiled three essential aspects you should further research:
1. Valuation: What is 255 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 255 is currently mispriced by the market.
2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Lung Kee (Bermuda) Holdings’s board and the CEO’s back ground.
3. 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.
