Yahoo Finance Fiducian Group (ASX:FID) Could Be A Buy For Its Upcoming Dividend
Fiducian Group Limited (ASX:FID) is about to trade ex-dividend in the next 4 days. You can purchase shares before the 26th of February in order to receive the dividend, which the company will pay on the 15th of March.
Fiducian Group's next dividend payment will be AU$0.12 per share, and in the last 12 months, the company paid a total of AU$0.25 per share. Based on the last year's worth of payments, Fiducian Group has a trailing yield of 4.1% on the current stock price of A$6.01. If you buy this business for its dividend, you should have an idea of whether Fiducian Group's dividend is reliable and sustainable. As a result, readers should always check whether Fiducian Group has been able to grow its dividends, or if the dividend might be cut.
See our latest analysis for Fiducian 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. Fiducian Group paid out more than half (69%) of its earnings last year, which is a regular payout ratio for most companies.
When a company paid out less in dividends than it earned in profit, this generally suggests its dividend is affordable. The lower the % of its profit that it pays out, the greater the margin of safety for the dividend if the business enters a downturn.
Click here to see how much of its profit Fiducian Group paid out over the last 12 months.
Have Earnings And Dividends Been Growing?
Businesses with strong growth prospects usually make the best dividend payers, because it's easier to grow dividends when earnings per share are improving. If earnings decline and the company is forced to cut its dividend, investors could watch the value of their investment go up in smoke. For this reason, we're glad to see Fiducian Group's earnings per share have risen 18% per annum over the last five years.
Many investors will assess a company's dividend performance by evaluating how much the dividend payments have changed over time. In the past 10 years, Fiducian Group has increased its dividend at approximately 11% a year on average. It's exciting to see that both earnings and dividends per share have grown rapidly over the past few years.
The Bottom Line
Is Fiducian Group an attractive dividend stock, or better left on the shelf? Fiducian Group has an acceptable payout ratio and its earnings per share have been improving at a decent rate. In summary, Fiducian Group appears to have some promise as a dividend stock, and we'd suggest taking a closer look at it.
On that note, you'll want to research what risks Fiducian Group is facing. Every company has risks, and we've spotted 1 warning sign for Fiducian Group you should know about.
We wouldn't recommend just buying the first dividend stock you see, though. Here's a list of interesting dividend stocks with a greater than 2% yield and an upcoming dividend.
This article by Simply Wall St is general in nature. 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.
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