Ingles Markets' (NASDAQ:IMKT.A) Dividend Will Be $0.165
Ingles Markets, Incorporated's (NASDAQ:IMKT.A) investors are due to receive a payment of $0.165 per share on 15th of January. The dividend yield is 1.0% based on this payment, which is a little bit low compared to the other companies in the industry.
Ingles Markets' Projected Earnings Seem Likely To Cover Future Distributions
Even a low dividend yield can be attractive if it is sustained for years on end. However, prior to this announcement, Ingles Markets' dividend was comfortably covered by both cash flow and earnings. This means that most of its earnings are being retained to grow the business.
Unless the company can turn things around, EPS could fall by 13.0% over the next year. If the dividend continues along the path it has been on recently, we estimate the payout ratio could be 17%, which is definitely feasible to continue.
See our latest analysis for Ingles Markets
Ingles Markets Has A Solid Track Record
The company has a sustained record of paying dividends with very little fluctuation. There hasn't been much of a change in the dividend over the last 10 years. Slow and steady dividend growth might not sound that exciting, but dividends have been stable for ten years, which we think makes this a fairly attractive offer.
Dividend Growth Potential Is Shaky
Investors could be attracted to the stock based on the quality of its payment history. However, things aren't all that rosy. Over the past five years, it looks as though Ingles Markets' EPS has declined at around 13% a year. Dividend payments are likely to come under some pressure unless EPS can pull out of the nosedive it is in.
In Summary
In summary, we are pleased with the dividend remaining consistent, and we think there is a good chance of this continuing in the future. While the payments look sustainable for now, earnings have been shrinking so the dividend could come under pressure in the future. The payment isn't stellar, but it could make a decent addition to a dividend portfolio.
Investors generally tend to favour companies with a consistent, stable dividend policy as opposed to those operating an irregular one. At the same time, there are other factors our readers should be conscious of before pouring capital into a stock. For instance, we've picked out 1 warning sign for Ingles Markets that investors should take into consideration. Is Ingles Markets not quite the opportunity you were looking for? Why not check out our selection of top dividend stocks.
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