Shares of COSCO SHIPPING International (Hong Kong) Co Ltd. (SEHK:517) will begin trading ex-dividend in 3 days. To qualify for the dividend check of HK$0.12 per share, investors must have owned the shares prior to 04 June 2018, which is the last day the company’s management will finalize their list of shareholders to which they will send dividend payments. Is this future income a persuasive enough catalyst for investors to think about COSCO SHIPPING International (Hong Kong) as an investment today? Below, I’m going to look at the latest data and analyze the stock and its dividend property in further detail. View our latest analysis for COSCO SHIPPING International (Hong Kong)
5 checks you should do on a dividend stock
Whenever I am looking at a potential dividend stock investment, I always check these five metrics:
- Is its annual yield among the top 25% of dividend payers?
- Has it paid dividend every year without dramatically reducing payout in the past?
- Has it increased its dividend per share amount over the past?
- Is its earnings sufficient to payout dividend at the current rate?
- Will it be able to continue to payout at the current rate in the future?
Does COSCO SHIPPING International (Hong Kong) pass our checks?
The company currently pays out 77.37% of its earnings as a dividend, according to its trailing twelve-month data, meaning the dividend is sufficiently covered by earnings. However, going forward, analysts expect 517’s payout to fall to 69.23% of its earnings, which leads to a dividend yield of around 5.63%. However, EPS should increase to HK$0.24, meaning that the lower payout ratio does not necessarily implicate a lower dividend payment. 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. 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. Relative to peers, COSCO SHIPPING International (Hong Kong) generates a yield of 7.50%, which is high for Infrastructure stocks.
Taking into account the dividend metrics, COSCO SHIPPING International (Hong Kong) ticks most of the boxes as a strong dividend investment, putting it in my list of top dividend payers. Given that this is purely a dividend analysis, I urge potential investors to try and get a good understanding of the underlying business and its fundamentals before deciding on an investment. I’ve put together three essential factors you should further examine:
- Future Outlook: What are well-informed industry analysts predicting for 517’s future growth? Take a look at our free research report of analyst consensus for 517’s outlook.
- Historical Performance: What has 517’s returns been like over the past? Go into more detail in the past track record analysis and take a look at the free visual representations of our analysis for more clarity.
- 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.