Is It Smart To Buy Global Indemnity Group, LLC (NYSE:GBLI) Before It Goes Ex-Dividend?
Global Indemnity Group, LLC (NYSE:GBLI) is about to trade ex-dividend in the next 3 days. The ex-dividend date is usually set to be one business day before the record date which is the cut-off date on which you must be present on the company's books as a shareholder in order to receive the dividend. The ex-dividend date is an important date to be aware of as any purchase of the stock made on or after this date might mean a late settlement that doesn't show on the record date. Therefore, if you purchase Global Indemnity Group's shares on or after the 20th of March, you won't be eligible to receive the dividend, when it is paid on the 28th of March.
The company's next dividend payment will be US$0.35 per share, on the back of last year when the company paid a total of US$1.00 to shareholders. Last year's total dividend payments show that Global Indemnity Group has a trailing yield of 4.7% on the current share price of US$29.95. Dividends are an important source of income to many shareholders, but the health of the business is crucial to maintaining those dividends. That's why we should always check whether the dividend payments appear sustainable, and if the company is growing.
See our latest analysis for Global Indemnity Group
Dividends are typically paid from company earnings. If a company pays more in dividends than it earned in profit, then the dividend could be unsustainable. Global Indemnity Group is paying out an acceptable 54% of its profit, a common payout level among most companies.
Generally speaking, the lower a company's payout ratios, the more resilient its dividend usually is.
Click here to see how much of its profit Global Indemnity Group paid out over the last 12 months.
Have Earnings And Dividends Been Growing?
Stocks in companies that generate sustainable earnings growth often make the best dividend prospects, as it is easier to lift the dividend when earnings are rising. Investors love dividends, so if earnings fall and the dividend is reduced, expect a stock to be sold off heavily at the same time. That's why it's comforting to see Global Indemnity Group's earnings have been skyrocketing, up 41% per annum for the past five years.
Many investors will assess a company's dividend performance by evaluating how much the dividend payments have changed over time. Since the start of our data, six years ago, Global Indemnity Group has lifted its dividend by approximately 5.8% a year on average. Earnings per share have been growing much quicker than dividends, potentially because Global Indemnity Group is keeping back more of its profits to grow the business.
The Bottom Line
Is Global Indemnity Group an attractive dividend stock, or better left on the shelf? Earnings per share are growing at an attractive rate, and Global Indemnity Group is paying out a bit over half its profits. Global Indemnity Group ticks a lot of boxes for us from a dividend perspective, and we think these characteristics should mark the company as deserving of further attention.
With that in mind, a critical part of thorough stock research is being aware of any risks that stock currently faces. In terms of investment risks, we've identified 1 warning sign with Global Indemnity Group and understanding them should be part of your investment process.
A common investing mistake is buying the first interesting stock you see. Here you can find a full list of high-yield dividend stocks.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
