Just Three Days Till Kerur Holdings Ltd. (TLV:KRUR) Will Be Trading Ex-Dividend
Kerur Holdings Ltd. (TLV:KRUR) stock is about to trade ex-dividend in 3 days. The ex-dividend date is commonly two business days 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 important as the process of settlement involves at least two full business days. So if you miss that date, you would not show up on the company's books on the record date. This means that investors who purchase Kerur Holdings' shares on or after the 17th of July will not receive the dividend, which will be paid on the 27th of July.
The company's next dividend payment will be ₪3.975342 per share, and in the last 12 months, the company paid a total of ₪3.98 per share. Based on the last year's worth of payments, Kerur Holdings has a trailing yield of 4.9% on the current stock price of ₪80.81. We love seeing companies pay a dividend, but it's also important to be sure that laying the golden eggs isn't going to kill our golden goose! So we need to investigate whether Kerur Holdings can afford its dividend, and if the dividend could grow.
If a company pays out more in dividends than it earned, then the dividend might become unsustainable - hardly an ideal situation. Kerur Holdings paid out more than half (56%) of its earnings last year, which is a regular payout ratio for most companies. Yet cash flow is typically more important than profit for assessing dividend sustainability, so we should always check if the company generated enough cash to afford its dividend.
View our latest analysis for Kerur Holdings
Click here to see how much of its profit Kerur Holdings paid out over the last 12 months.
Have Earnings And Dividends Been Growing?
Companies with consistently growing earnings per share generally make the best dividend stocks, as they usually find it easier to grow dividends per share. If earnings fall far enough, the company could be forced to cut its dividend. With that in mind, we're encouraged by the steady growth at Kerur Holdings, with earnings per share up 2.4% on average over the last five years. Earnings growth has been slim and the company is paying out more than half of its earnings. While there is some room to both increase the payout ratio and reinvest in the business, generally the higher a payout ratio goes, the lower a company's prospects for future growth.
The main way most investors will assess a company's dividend prospects is by checking the historical rate of dividend growth. Kerur Holdings has delivered an average of 8.0% per year annual increase in its dividend, based on the past nine years of dividend payments. It's encouraging to see the company lifting dividends while earnings are growing, suggesting at least some corporate interest in rewarding shareholders.
To Sum It Up
Is Kerur Holdings an attractive dividend stock, or better left on the shelf? Earnings per share growth has been modest and Kerur Holdings paid out over half of its profits and less than half of its free cash flow, although both payout ratios are within normal limits. To summarise, Kerur Holdings looks okay on this analysis, although it doesn't appear a stand-out opportunity.
So while Kerur Holdings looks good from a dividend perspective, it's always worthwhile being up to date with the risks involved in this stock. Be aware that Kerur Holdings is showing 2 warning signs in our investment analysis, and 1 of those can't be ignored...
Generally, we wouldn't recommend just buying the first dividend stock you see. Here's a curated list of interesting stocks that are strong dividend payers.
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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.