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Read This Before Buying Carnival plc (LON:CCL) For Its Upcoming £0.5 Dividend

Shares of Carnival plc (LSE:CCL) will begin trading ex-dividend in 9 days. To qualify for the dividend check of $0.5 per share, investors must have owned the shares prior to 24 May 2018, which is the last day the company’s management will finalize their list of shareholders to which they will send dividend payments. Investors looking for higher income-generating stocks to add to their portfolio should keep reading, as I examine Carnival’s latest financial data to analyse its dividend characteristics. See our latest analysis for Carnival

How I analyze a dividend stock

When researching a dividend stock, I always follow the following screening criteria:

  • Is its annual yield among the top 25% of dividend-paying companies?

  • Has it paid dividend every year without dramatically reducing payout in the past?

  • Has the amount of dividend per share grown over the past?

  • Is its earnings sufficient to payout dividend at the current rate?

  • Will it have the ability to keep paying its dividends going forward?

LSE:CCL Historical Dividend Yield May 14th 18
LSE:CCL Historical Dividend Yield May 14th 18

How does Carnival fare?

The current trailing twelve-month payout ratio for the stock is 46.28%, meaning the dividend is sufficiently covered by earnings. In the near future, analysts are predicting lower payout ratio of 40.89%, leading to a dividend yield of around 3.39%. However, EPS should increase to $4.6, meaning that the lower payout ratio does not necessarily implicate a lower dividend payment. If there is one thing that you want to be reliable in your life, it’s dividend stocks and their constant income stream. Whilst its per-share payments have increased during the past 10 years, there has been some hiccups. Shareholders would have seen a few years of reduced payments in this time. In terms of its peers, Carnival produces a yield of 2.89%, which is high for Hospitality stocks but still below the market’s top dividend payers.

Next Steps:

With this in mind, I definitely rank Carnival as a strong dividend stock, and makes it worth further research for anyone who likes steady income generation from their 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 factors you should further examine:

  1. Future Outlook: What are well-informed industry analysts predicting for CCL’s future growth? Take a look at our free research report of analyst consensus for CCL’s outlook.

  2. Valuation: What is CCL 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 CCL is currently mispriced by the market.

  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.

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