Read This Before Buying Secure Energy Services Inc (TSX:SES) For Its Upcoming $0.02 Dividend
On the 15 December 2017, Secure Energy Services Inc (TSX:SES) will be paying shareholders an upcoming dividend amount of CA$0.02 per share. However, investors must have bought the company’s stock before 30 November 2017 in order to qualify for the payment. That means you have only 3 days left! Is this future income stream a compelling catalyst for dividend investors to think about SES as an investment today? Let’s take a look at SES’s most recent financial data to examine its dividend characteristics in more detail. See our latest analysis for SES
How I analyze 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-paying companies?
Does it consistently pay out dividends without missing a payment of significantly cutting payout?
Has dividend per share amount increased over the past?
Is is able to pay the current rate of dividends from its earnings?
Based on future earnings growth, will it be able to continue to payout dividend at the current rate?
Does Secure Energy Services pass our checks?
Secure Energy Services has a negative payout ratio, which means that it is loss-making, and paying its dividend from its retained earnings. If there’s one type of stock you want to be reliable, it’s dividend stocks and their stable income-generating ability. Unfortunately, it is really too early to view Secure Energy Services as a dividend investment. It has only been consistently paying dividends for 5 years, however, standard practice for reliable payers is to look for a 10-year minimum track record. Relative to peers, SES generates a yield of 3.26%, which is high for energy equipment and services stocks.
What this means for you:
Are you a shareholder? You may be wondering why Secure Energy Services is paying out dividends at all, instead of re-investing into the business to generate higher cash flows in the future. It may be beneficial exploring other dividend stocks as alternatives to SES or even look at high-growth stocks to supplement your steady income stocks. I recommend continuing your research by checking out my interactive free list of dividend rockstars as well as high-growth stocks to potentially add to your holdings.
Are you a potential investor? After digging a little deeper into SES’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, SES could still be offering some interesting investment opportunities. I also recommend taking sufficient time to understand its core business and determine whether the company and its investment properties suit your overall goals. Dig deeper in our latest free fundmental analysis to explore other aspects of SES.
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.
