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Only 3 Days Left To Cash In On Psychemedics Corporation (NASDAQ:PMD) Dividend, Is It Worth Buying?

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Gabriel Boyd
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Attention dividend hunters! Psychemedics Corporation (NASDAQ:PMD) will be distributing its dividend of $0.15 per share on the 29 March 2018, and will start trading ex-dividend in 3 days time on the 16 March 2018. Is this future income stream a compelling catalyst for dividend investors to think about the stock as an investment today? Let’s take a look at Psychemedics’s most recent financial data to examine its dividend characteristics in more detail. Check out our latest analysis for Psychemedics

5 questions to ask before buying a dividend stock

Whenever I am looking at a potential dividend stock investment, I always check these five metrics:

  • Is it paying an annual yield above 75% of dividend payers?

  • Has it consistently paid a stable dividend without missing a payment or drastically cutting payout?

  • Has dividend per share amount increased over the past?

  • Is is able to pay the current rate of dividends from its earnings?

  • Will the company be able to keep paying dividend based on the future earnings growth?

NasdaqCM:PMD Historical Dividend Yield Mar 12th 18
NasdaqCM:PMD Historical Dividend Yield Mar 12th 18

How well does Psychemedics fit our criteria?

The company currently pays out 54.55% of its earnings as a dividend, according to its trailing twelve-month data, 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’s one type of stock you want to be reliable, it’s dividend stocks and their stable income-generating ability. Not only have dividend payouts from Psychemedics fallen over the past 10 years, it has also been highly volatile during this time, with drops of over 25% in some years. These characteristics do not bode well for income investors seeking reliable stream of dividends. Compared to its peers, Psychemedics has a yield of 2.97%, which is high for Healthcare stocks but still below the market’s top dividend payers.

Next Steps:

After digging a little deeper into Psychemedics’s yield, it’s easy to see why you should be cautious investing in the company just for the dividend. On the other hand, if you are not strictly just a dividend investor, the stock could still be offering some interesting investment opportunities. 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. There are three pertinent aspects you should look at:

  1. Valuation: What is PMD 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 PMD 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 Psychemedics’s board and the CEO’s back ground.

  3. 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.