Fuva Brain Limited (TSE:3927) Looks Like A Good Stock, And It's Going Ex-Dividend Soon
Regular readers will know that we love our dividends at Simply Wall St, which is why it's exciting to see Fuva Brain Limited (TSE:3927) is about to trade ex-dividend in the next 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 an important date to be aware of as any purchase of the stock made on or after this date might mean a late settlement that doesn't show on the record date. Therefore, if you purchase Fuva Brain's shares on or after the 29th of September, you won't be eligible to receive the dividend, when it is paid on the .
The company's next dividend payment will be JP¥8.00 per share, and in the last 12 months, the company paid a total of JP¥16.00 per share. Last year's total dividend payments show that Fuva Brain has a trailing yield of 1.8% on the current share price of JP¥910.00. If you buy this business for its dividend, you should have an idea of whether Fuva Brain's dividend is reliable and sustainable. We need to see whether the dividend is covered by earnings and if it's 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. Fuva Brain paid out more than half (61%) of its earnings last year, which is a regular payout ratio for most companies.
See our latest analysis for Fuva Brain
Click here to see how much of its profit Fuva Brain 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. Investors love dividends, so if earnings fall and the dividend is reduced, expect a stock to be sold off heavily at the same time. That's why it's comforting to see Fuva Brain's earnings have been skyrocketing, up 69% per annum for the past five years. The current payout ratio suggests a good balance between rewarding shareholders with dividends, and reinvesting in growth. With a reasonable payout ratio, profits being reinvested, and some earnings growth, Fuva Brain could have strong prospects for future increases to the dividend.
Given that Fuva Brain has only been paying a dividend for a year, there's not much of a past history to draw insight from.
The Bottom Line
From a dividend perspective, should investors buy or avoid Fuva Brain? Fuva Brain has an acceptable payout ratio and its earnings per share have been improving at a decent rate. Fuva Brain ticks a lot of boxes for us from a dividend perspective, and we think these characteristics should mark the company as deserving of further attention.
In light of that, while Fuva Brain has an appealing dividend, it's worth knowing the risks involved with this stock. For example, we've found 3 warning signs for Fuva Brain that we recommend you consider before investing in the business.
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.