Only 2 Days Left To Bharat Petroleum Corporation Limited (NSE:BPCL)’s Ex-Dividend Date, Should Investors Buy?
On the 11 October 2018, Bharat Petroleum Corporation Limited (NSE:BPCL) will be paying shareholders an upcoming dividend amount of ₹7.00 per share. However, investors must have bought the company’s stock before 31 August 2018 in order to qualify for the payment. That means you have only 2 days left! Investors looking for higher income-generating stocks to add to their portfolio should keep reading, as I examine Bharat Petroleum’s latest financial data to analyse its dividend characteristics.
View our latest analysis for Bharat Petroleum
Here’s how I find good dividend stocks
When assessing a stock as a potential addition to my dividend Portfolio, I look at these five areas:
Is its annual yield among the top 25% of dividend-paying companies?
Has it consistently paid a stable dividend without missing a payment or drastically cutting payout?
Has dividend per share risen in the past couple of years?
Is its earnings sufficient to payout dividend at the current rate?
Based on future earnings growth, will it be able to continue to payout dividend at the current rate?
Does Bharat Petroleum pass our checks?
Bharat Petroleum has a trailing twelve-month payout ratio of 45.9%, which means that the dividend is covered by earnings. Going forward, analysts expect BPCL’s payout to remain around the same level at 42.2% of its earnings, which leads to a dividend yield of around 5.9%. In addition to this, EPS should increase to ₹47.9.
If dividend is a key criteria in your investment consideration, then you need to make sure the dividend stock you’re eyeing out is reliable in its payments. Although BPCL’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.
Compared to its peers, Bharat Petroleum produces a yield of 5.9%, which is high for Oil and Gas stocks.
Next Steps:
Keeping in mind the dividend characteristics above, Bharat Petroleum 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. I’ve put together three relevant factors you should further research:
Future Outlook: What are well-informed industry analysts predicting for BPCL’s future growth? Take a look at our free research report of analyst consensus for BPCL’s outlook.
Valuation: What is BPCL 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 BPCL 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 past 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. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.
