There's A Lot To Like About Foresight Group Holdings' (LON:FSG) Upcoming UK£0.19 Dividend
It looks like Foresight Group Holdings Limited (LON:FSG) is about to go ex-dividend in the next 4 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. It is important to be aware of the ex-dividend date because any trade on the stock needs to have been settled on or before the record date. This means that investors who purchase Foresight Group Holdings' shares on or after the 17th of September will not receive the dividend, which will be paid on the 2nd of October.
The company's upcoming dividend is UK£0.19 a share, following on from the last 12 months, when the company distributed a total of UK£0.27 per share to shareholders. Last year's total dividend payments show that Foresight Group Holdings has a trailing yield of 5.7% on the current share price of UK£4.72. Dividends are an important source of income to many shareholders, but the health of the business is crucial to maintaining those dividends. So we need to investigate whether Foresight Group 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. Foresight Group Holdings paid out more than half (67%) of its earnings last year, which is a regular payout ratio for most companies.
Companies that pay out less in dividends than they earn in profits generally have more sustainable dividends. The lower the payout ratio, the more wiggle room the business has before it could be forced to cut the dividend.
Check out our latest analysis for Foresight Group Holdings
Click here to see the company's payout ratio, plus analyst estimates of its future dividends.
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. That's why it's comforting to see Foresight Group Holdings's earnings have been skyrocketing, up 23% per annum for the past five years.
Many investors will assess a company's dividend performance by evaluating how much the dividend payments have changed over time. Since the start of our data, five years ago, Foresight Group Holdings has lifted its dividend by approximately 74% a year on average. Both per-share earnings and dividends have both been growing rapidly in recent times, which is great to see.
To Sum It Up
Has Foresight Group Holdings got what it takes to maintain its dividend payments? Earnings per share are growing at an attractive rate, and Foresight Group Holdings is paying out a bit over half its profits. We think this is a pretty attractive combination, and would be interested in investigating Foresight Group Holdings more closely.
Curious what other investors think of Foresight Group Holdings? See what analysts are forecasting, with this visualisation of its historical and future estimated earnings and cash flow.
A common investing mistake is buying the first interesting stock you see. Here you can find a full list of high-yield dividend stocks.
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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.