Three Days Left Until Nippon BS Broadcasting Corporation (TSE:9414) Trades Ex-Dividend
Nippon BS Broadcasting Corporation (TSE:9414) stock is about to trade ex-dividend in three days. The ex-dividend date generally occurs two days before the record date, which is the day on which shareholders need to be on the company's books in order to receive a dividend. 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. Thus, you can purchase Nippon BS Broadcasting's shares before the 28th of August in order to receive the dividend, which the company will pay on the 20th of November.
The company's next dividend payment will be JP¥30.00 per share, and in the last 12 months, the company paid a total of JP¥30.00 per share. Looking at the last 12 months of distributions, Nippon BS Broadcasting has a trailing yield of approximately 3.2% on its current stock price of JP¥925.00. Dividends are a major contributor to investment returns for long term holders, but only if the dividend continues to be paid. That's why we should always check whether the dividend payments appear sustainable, and if the company is growing.
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. Fortunately Nippon BS Broadcasting's payout ratio is modest, at just 44% of profit. 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. Fortunately, it paid out only 41% of its free cash flow in the past year.
It's positive to see that Nippon BS Broadcasting's dividend is covered by both profits and cash flow, since this is generally a sign that the dividend is sustainable, and a lower payout ratio usually suggests a greater margin of safety before the dividend gets cut.
View our latest analysis for Nippon BS Broadcasting
Click here to see how much of its profit Nippon BS Broadcasting paid out over the last 12 months.
Have Earnings And Dividends Been Growing?
Businesses with shrinking earnings are tricky from a dividend perspective. If business enters a downturn and the dividend is cut, the company could see its value fall precipitously. That's why it's not ideal to see Nippon BS Broadcasting's earnings per share have been shrinking at 4.2% a year over the previous five years.
Another key way to measure a company's dividend prospects is by measuring its historical rate of dividend growth. In the last eight years, Nippon BS Broadcasting has lifted its dividend by approximately 5.9% a year on average.
Final Takeaway
Is Nippon BS Broadcasting worth buying for its dividend? Nippon BS Broadcasting has comfortably low cash and profit payout ratios, which may mean the dividend is sustainable even in the face of a sharp decline in earnings per share. Still, we consider declining earnings to be a warning sign. In summary, it's hard to get excited about Nippon BS Broadcasting from a dividend perspective.
On that note, you'll want to research what risks Nippon BS Broadcasting is facing. We've identified 2 warning signs with Nippon BS Broadcasting (at least 1 which makes us a bit uncomfortable), and understanding them should be part of your investment process.
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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.