Is Buying China Resources Land Limited (HKG:1109) For Its Upcoming $0.87 Dividend A Good Choice?

Investors who want to cash in on China Resources Land Limited’s (SEHK:1109) upcoming dividend of HK$0.87 per share have only 6 days left to buy the shares before its ex-dividend date, 13 June 2018, in time for dividends payable on the 05 July 2018. What does this mean for current shareholders and potential investors? Below, I will explain how holding China Resources Land can impact your portfolio income stream, by analysing the stock’s most recent financial data and dividend attributes. Check out our latest analysis for China Resources Land

5 questions to ask before buying a dividend stock

Whenever I am looking at a potential dividend stock investment, I always check these five metrics:

• Is their annual yield among the top 25% of dividend payers?

• Has its dividend been stable over the past (i.e. no missed payments or significant payout cuts)?

• Has the amount of dividend per share grown over the past?

• Is its earnings sufficient to payout dividend at the current rate?

• Will it have the ability to keep paying its dividends going forward?

SEHK:1109 Historical Dividend Yield Jun 6th 18

How does China Resources Land fare?

China Resources Land has a trailing twelve-month payout ratio of 29.12%, meaning the dividend is sufficiently covered by earnings. In the near future, analysts are predicting a higher payout ratio of 34.73%, leading to a dividend yield of 4.46%. In addition to this, EPS should increase to HK$3.69. The higher payout forecasted, along with higher earnings, should lead to greater dividend income for investors moving forward. Reliablity is an important factor for dividend stocks, particularly for income investors who want a strong track record of payment and a positive outlook for future payout. Whilst its per-share payments have increased during the past 10 years, there has been some hiccups. Investors have seen reductions in the dividend per share in the past, although, it has picked up again. Relative to peers, China Resources Land produces a yield of 3.06%, which is on the low-side for Real Estate stocks.

Next Steps:

Keeping in mind the dividend characteristics above, China Resources Land is definitely worth considering for investors looking to build a dedicated income portfolio. Given that this is purely a dividend analysis, I urge potential investors to try and get a good understanding of the underlying business and its fundamentals before deciding on an investment. There are three essential factors you should look at:

1. Future Outlook: What are well-informed industry analysts predicting for 1109’s future growth? Take a look at our free research report of analyst consensus for 1109’s outlook.

2. Valuation: What is 1109 worth today? Even if the stock is a cash cow, it’s not worth an infinite price. The intrinsic value infographic in our free research report helps visualize whether 1109 is currently mispriced by the market.

3. Other Dividend Rockstars: Are there better dividend payers with stronger fundamentals out there? Check out our free list of these great stocks here.

To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned.