Yahoo Finance Argentex Group Plc (LON:AGFX) Pays A UK£0.0075 Dividend In Just Three Days
Readers hoping to buy Argentex Group Plc (LON:AGFX) for its dividend will need to make their move shortly, as the stock is about to trade ex-dividend. The ex-dividend date is one business day before the record date, which is the cut-off date for shareholders to be present on the company's books to be eligible for a dividend payment. The ex-dividend date is of consequence because whenever a stock is bought or sold, the trade takes at least two business day to settle. Therefore, if you purchase Argentex Group's shares on or after the 9th of December, you won't be eligible to receive the dividend, when it is paid on the 8th of January.
The company's next dividend payment will be UK£0.0075 per share, and in the last 12 months, the company paid a total of UK£0.015 per share. Looking at the last 12 months of distributions, Argentex Group has a trailing yield of approximately 1.7% on its current stock price of £0.878. Dividends are an important source of income to many shareholders, but the health of the business is crucial to maintaining those dividends. We need to see whether the dividend is covered by earnings and if it's growing.
View our latest analysis for Argentex Group
If a company pays out more in dividends than it earned, then the dividend might become unsustainable - hardly an ideal situation. Argentex Group paid out a comfortable 48% of its profit last year.
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 Argentex Group paid out over the last 12 months.
Have Earnings And Dividends Been Growing?
When earnings decline, dividend companies become much harder to analyse and own safely. If earnings decline and the company is forced to cut its dividend, investors could watch the value of their investment go up in smoke. From this viewpoint, it's unfortunate that earnings per share have declined 15% over the last year.
Given that Argentex Group has only been paying a dividend for a year, there's not much of a past history to draw insight from.
The Bottom Line
Is Argentex Group worth buying for its dividend? Argentex Group's earnings per share have declined over the past 12 months, although we note that it is paying out a low fraction of its earnings. Ordinarily we wouldn't be too concerned about a one-year decline, especially given the payout ratio is low. This makes us wonder if the company is incurring costs by reinvesting in its business. Ordinarily we wouldn't be too concerned about a one-year decline, but the -15% drop in earnings per share is enough to make us think twice. At best we would put it on a watch-list to see if business conditions improve, as it doesn't look like a clear opportunity right now.
However if you're still interested in Argentex Group as a potential investment, you should definitely consider some of the risks involved with Argentex Group. For example - Argentex Group has 1 warning sign we think you should be aware of.
If you're in the market for dividend stocks, we recommend checking our list of top dividend stocks with a greater than 2% yield and an upcoming dividend.
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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.
