Yahoo Finance 2 Days Left To Cash In On Shopping Centres Australasia Property Group (ASX:SCP) Dividend, Should You Buy?
Have you been keeping an eye on Shopping Centres Australasia Property Group’s (ASX:SCP) upcoming dividend of AU$0.071 per share payable on the 30 August 2018? Then you only have 2 days left before the stock starts trading ex-dividend on the 28 June 2018. Investors looking for higher income-generating stocks to add to their portfolio should keep reading, as I examine Shopping Centres Australasia Property Group’s latest financial data to analyse its dividend characteristics. See our latest analysis for Shopping Centres Australasia Property Group
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 its dividend been stable over the past (i.e. no missed payments or significant payout cuts)?
Has it increased its dividend per share amount over the past?
Is its earnings sufficient to payout dividend at the current rate?
Will the company be able to keep paying dividend based on the future earnings growth?
Does Shopping Centres Australasia Property Group pass our checks?
Shopping Centres Australasia Property Group has a trailing twelve-month payout ratio of 54.51%, which is rather low compared to other REITs. Generally, REITs are expected to pay out the majority of its earnings to provide a regular income stream for their investors. In the near future, analysts are predicting a higher payout ratio of 90.50%, leading to a dividend yield of around 5.48%. However, EPS is forecasted to fall to A$0.15 in the upcoming year. Therefore, although payout is expected to increase, the fall in earnings may not equate to higher dividend income. This also brings about uncertainty around the sustainability of the payout ratio.
Reliablity is an important factor for dividend stocks, particularly for income investors who want a strong track record of payment and a positive outlook for future payout. Unfortunately, it is really too early to view Shopping Centres Australasia Property Group 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, Shopping Centres Australasia Property Group has a yield of 5.55%, which is high for REITs stocks but still below the market’s top dividend payers.
Next Steps:
If Shopping Centres Australasia Property Group is in your portfolio for cash-generating reasons, there may be better alternatives out there. However, if you are not strictly just a dividend investor, the stock could still offer some interesting investment opportunities. 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. I’ve put together three essential factors you should further examine:
Future Outlook: What are well-informed industry analysts predicting for SCP’s future growth? Take a look at our free research report of analyst consensus for SCP’s outlook.
Valuation: What is SCP 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 SCP is currently mispriced by the market.
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.
