Yahoo Finance SKYCITY Entertainment Group Limited (NZSE:SKC): What You Have To Know Before Buying For The Upcoming Dividend
Investors who want to cash in on SKYCITY Entertainment Group Limited’s (NZSE:SKC) upcoming dividend of NZ$0.12 per share have only 2 days left to buy the shares before its ex-dividend date, 30 August 2018, in time for dividends payable on the 14 September 2018. Investors looking for higher income-generating stocks to add to their portfolio should keep reading, as I examine SKYCITY Entertainment Group’s latest financial data to analyse its dividend characteristics.
View our latest analysis for SKYCITY Entertainment Group
5 questions I ask before picking a dividend stock
When assessing a stock as a potential addition to my dividend Portfolio, I look at these five areas:
Is it the top 25% annual dividend yield payer?
Does it consistently pay out dividends without missing a payment of significantly cutting payout?
Has dividend per share risen in the past couple of years?
Can it afford to pay the current rate of dividends from its earnings?
Based on future earnings growth, will it be able to continue to payout dividend at the current rate?
Does SKYCITY Entertainment Group pass our checks?
The current trailing twelve-month payout ratio for the stock is 78.9%, meaning the dividend is sufficiently covered by earnings. Going forward, analysts expect SKC’s payout to remain around the same level at 86.4% of its earnings, which leads to a dividend yield of around 4.8%. In addition to this, EPS should increase to NZ$0.25.
If there is one thing that you want to be reliable in your life, it’s dividend stocks and their constant income stream. Not only have dividend payouts from SKYCITY Entertainment Group fallen over the past 10 years, it has also been highly volatile during this time, with drops of over 25% in some years. This means that dividend hunters should probably steer clear of the stock, at least for now until the track record improves.
Relative to peers, SKYCITY Entertainment Group produces a yield of 4.7%, which is high for Hospitality stocks but still below the market’s top dividend payers.
Next Steps:
If you are building an income portfolio, then SKYCITY Entertainment Group is a complicated choice since it has some positive aspects as well as negative ones. But if you are not exclusively a dividend investor, the stock could still be an interesting investment opportunity. 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. There are three key aspects you should look at:
Future Outlook: What are well-informed industry analysts predicting for SKC’s future growth? Take a look at our free research report of analyst consensus for SKC’s outlook.
Valuation: What is SKC 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 SKC 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 past 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. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.
