Taitron Components' (NASDAQ:TAIT) Dividend Will Be $0.05
Taitron Components Incorporated (NASDAQ:TAIT) will pay a dividend of $0.05 on the 30th of November. This means the annual payment is 5.9% of the current stock price, which is above the average for the industry.
Check out our latest analysis for Taitron Components
Taitron Components' Dividend Is Well Covered By Earnings
If the payments aren't sustainable, a high yield for a few years won't matter that much. Based on the last payment, Taitron Components was quite comfortably earning enough to cover the dividend. This indicates that quite a large proportion of earnings is being invested back into the business.
Looking forward, earnings per share could rise by 21.5% over the next year if the trend from the last few years continues. Assuming the dividend continues along recent trends, we think the payout ratio could be 61% by next year, which is in a pretty sustainable range.
Taitron Components Doesn't Have A Long Payment History
Taitron Components' dividend has been pretty stable for a little while now, but we will continue to be cautious until it has been demonstrated for a few more years. The annual payment during the last 7 years was $0.10 in 2016, and the most recent fiscal year payment was $0.20. This means that it has been growing its distributions at 10% per annum over that time. It is always nice to see strong dividend growth, but with such a short payment history we wouldn't be inclined to rely on it until a longer track record can be developed.
The Dividend Looks Likely To Grow
Some investors will be chomping at the bit to buy some of the company's stock based on its dividend history. It's encouraging to see that Taitron Components has been growing its earnings per share at 22% a year over the past five years. Taitron Components is clearly able to grow rapidly while still returning cash to shareholders, positioning it to become a strong dividend payer in the future.
Taitron Components Looks Like A Great Dividend Stock
Overall, we like to see the dividend staying consistent, and we think Taitron Components might even raise payments in the future. Earnings are easily covering distributions, and the company is generating plenty of cash. All of these factors considered, we think this has solid potential as a dividend stock.
Market movements attest to how highly valued a consistent dividend policy is compared to one which is more unpredictable. Meanwhile, despite the importance of dividend payments, they are not the only factors our readers should know when assessing a company. For instance, we've picked out 4 warning signs for Taitron Components that investors should take into consideration. Looking for more high-yielding dividend ideas? Try our collection of strong dividend payers.
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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.
