Yahoo Finance Close Brothers Group plc (LON:CBG): 4 Days To Buy Before The Ex-Dividend Date
On the 20 November 2018, Close Brothers Group plc (LON:CBG) will be paying shareholders an upcoming dividend amount of UK£0.42 per share. However, investors must have bought the company’s stock before 11 October 2018 in order to qualify for the payment. That means you have only 4 days left! Should you diversify into Close Brothers Group and boost your portfolio income stream? Well, keep on reading because today, I’m going to look at the latest data and analyze the stock and its dividend property in further detail.
See our latest analysis for Close Brothers Group
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?
Does it consistently pay out dividends without missing a payment of significantly cutting payout?
Has it increased its dividend per share amount over the past?
Can it afford to pay the current rate of dividends from its earnings?
Will it be able to continue to payout at the current rate in the future?
How well does Close Brothers Group fit our criteria?
The current trailing twelve-month payout ratio for the stock is 46%, meaning the dividend is sufficiently covered by earnings. Going forward, analysts expect CBG’s payout to remain around the same level at 48% of its earnings, which leads to a dividend yield of 4.4%. In addition to this, EPS is forecasted to fall to £1.36 in the upcoming year.
If you want to dive deeper into the sustainability of a certain payout ratio, you may wish to consider the cash flow of the business. A business with strong cash flow can sustain a higher divided payout ratio than a company with weak cash flow.
If there is one thing that you want to be reliable in your life, it’s dividend stocks and their constant income stream. CBG has increased its DPS from £0.39 to £0.63 in the past 10 years. It has also been paying out dividend consistently during this time, as you’d expect for a company increasing its dividend levels. This is an impressive feat, which makes CBG a true dividend rockstar.
Relative to peers, Close Brothers Group has a yield of 4.0%, which is high for Capital Markets stocks but still below the market’s top dividend payers.
Next Steps:
Keeping in mind the dividend characteristics above, Close Brothers Group 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. There are three relevant factors you should further research:
Future Outlook: What are well-informed industry analysts predicting for CBG’s future growth? Take a look at our free research report of analyst consensus for CBG’s outlook.
Valuation: What is CBG 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 CBG 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.
To help readers see past 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. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.
