Yahoo Finance Card Factory plc (LON:CARD): 1 Days To Buy Before The Ex-Dividend Date
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On the 18 June 2019, Card Factory plc (LON:CARD) will be paying shareholders an upcoming dividend amount of UK£0.064 per share. However, investors must have bought the company's stock before 09 May 2019 in order to qualify for the payment. That means you have only 1 days left! Investors looking for higher income-generating stocks to add to their portfolio should keep reading, as I take a deeper dive into Card Factory's latest financial data to analyse its dividend attributes.
Check out our latest analysis for Card Factory
5 questions to ask before buying a dividend stock
If you are a dividend investor, you should always assess these five key metrics:
Is its annual yield among the top 25% of dividend-paying companies?
Has it paid dividend every year without dramatically reducing payout in the past?
Has dividend per share amount increased over the past?
Is is able to pay the current rate of dividends from its earnings?
Will the company be able to keep paying dividend based on the future earnings growth?
How well does Card Factory fit our criteria?
The company currently pays out 62% of its earnings as a dividend, according to its trailing twelve-month data, meaning the dividend is sufficiently covered by earnings. Going forward, analysts expect CARD's payout to increase to 88% of its earnings. Assuming a constant share price, this equates to a dividend yield of around 7.5%. Furthermore, EPS should increase to £0.17. The higher payout forecasted, along with higher earnings, should lead to greater dividend income for investors moving forward.
When considering the sustainability of dividends, it is also worth checking the cash flow of a company. Companies with strong cash flow can sustain a higher payout ratio, while companies with weaker cash flow generally cannot.
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. Unfortunately, it is really too early to view Card Factory as a dividend investment. It has only been consistently paying dividends for 5 years, however, standard practice for reliable payers is to look for a 10-year minimum track record.
In terms of its peers, Card Factory generates a yield of 7.2%, which is high for Specialty Retail stocks.
Next Steps:
Keeping in mind the dividend characteristics above, Card Factory is definitely worth considering for investors looking to build a dedicated income portfolio. Given that this is purely a dividend analysis, you should always research extensively before deciding whether or not a stock is an appropriate investment for you. I always recommend analysing the company's fundamentals and underlying business before making an investment decision. Below, I've compiled three essential factors you should further research:
Future Outlook: What are well-informed industry analysts predicting for CARD’s future growth? Take a look at our free research report of analyst consensus for CARD’s outlook.
Valuation: What is CARD 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 CARD is currently mispriced by the market.
Other Dividend Rockstars: Are there better dividend payers with stronger fundamentals out there? Check out our free list of these great stocks here.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
