Two Days Left To Buy Dr. Sulaiman Al Habib Medical Services Group Company (TADAWUL:4013) Before The Ex-Dividend Date
Dr. Sulaiman Al Habib Medical Services Group Company (TADAWUL:4013) stock is about to trade ex-dividend in 2 days. Typically, the ex-dividend date is two business days before the record date, which is the date on which a company determines the shareholders eligible 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. This means that investors who purchase Dr. Sulaiman Al Habib Medical Services Group's shares on or after the 1st of November will not receive the dividend, which will be paid on the 16th of November.
The company's next dividend payment will be ر.س1.37 per share. Last year, in total, the company distributed ر.س4.83 to shareholders. Based on the last year's worth of payments, Dr. Sulaiman Al Habib Medical Services Group stock has a trailing yield of around 2.2% on the current share price of ر.س223.10. If you buy this business for its dividend, you should have an idea of whether Dr. Sulaiman Al Habib Medical Services Group's dividend is reliable and sustainable. We need to see whether the dividend is covered by earnings and if it's growing.
If a company pays out more in dividends than it earned, then the dividend might become unsustainable - hardly an ideal situation. Dr. Sulaiman Al Habib Medical Services Group has a low and conservative payout ratio of just 18% of its income after tax. 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. It paid out an unsustainably high 206% of its free cash flow as dividends over the past 12 months, which is worrying. Unless there were something in the business we're not grasping, this could signal a risk that the dividend may have to be cut in the future.
While Dr. Sulaiman Al Habib Medical Services Group's dividends were covered by the company's reported profits, cash is somewhat more important, so it's not great to see that the company didn't generate enough cash to pay its dividend. Cash is king, as they say, and were Dr. Sulaiman Al Habib Medical Services Group to repeatedly pay dividends that aren't well covered by cashflow, we would consider this a warning sign.
See our latest analysis for Dr. Sulaiman Al Habib Medical Services Group
Click here to see the company's payout ratio, plus analyst estimates of its future dividends.
Have Earnings And Dividends Been Growing?
Businesses with strong growth prospects usually make the best dividend payers, because it's easier to grow dividends when earnings per share are improving. If earnings decline and the company is forced to cut its dividend, investors could watch the value of their investment go up in smoke. For this reason, we're glad to see Dr. Sulaiman Al Habib Medical Services Group's earnings per share have risen 19% per annum over the last five years. Earnings have been growing at a decent rate, but we're concerned dividend payments consumed most of the company's cash flow over the past year.
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, six years ago, Dr. Sulaiman Al Habib Medical Services Group has lifted its dividend by approximately 16% 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 Dr. Sulaiman Al Habib Medical Services Group got what it takes to maintain its dividend payments? We like that Dr. Sulaiman Al Habib Medical Services Group has been successfully growing its earnings per share at a nice rate and reinvesting most of its profits in the business. However, we note the high cashflow payout ratio with some concern. While it does have some good things going for it, we're a bit ambivalent and it would take more to convince us of Dr. Sulaiman Al Habib Medical Services Group's dividend merits.
So while Dr. Sulaiman Al Habib Medical Services Group looks good from a dividend perspective, it's always worthwhile being up to date with the risks involved in this stock. Every company has risks, and we've spotted 1 warning sign for Dr. Sulaiman Al Habib Medical Services Group you should know about.
If you're in the market for strong dividend payers, we recommend checking our selection of top dividend stocks.
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