Deutsche EuroShop AG (ETR:DEQ) Is An Attractive Dividend Stock, Here’s Why

There is a lot to be liked about Deutsche EuroShop AG (ETR:DEQ) as an income stock, over the past 10 years it has returned an average of 4.00% per year. The company is currently worth €1.98b, and now yields roughly 4.57%. Should it have a place in your portfolio? Let’s take a look at Deutsche EuroShop in more detail. See our latest analysis for Deutsche EuroShop

5 questions I ask before picking a dividend stock

When researching a dividend stock, I always follow the following screening criteria:

• Is its annual yield among the top 25% of dividend-paying companies?

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

• Has it increased its dividend per share amount over the past?

• Is is able to pay the current rate of dividends from its earnings?

• Based on future earnings growth, will it be able to continue to payout dividend at the current rate?

XTRA:DEQ Historical Dividend Yield June 21st 18

How does Deutsche EuroShop fare?

The current trailing twelve-month payout ratio for the stock is 63.33%, meaning the dividend is sufficiently covered by earnings. Going forward, analysts expect DEQ’s payout to increase to 73.14% of its earnings, which leads to a dividend yield of 4.87%. However, EPS is forecasted to fall to €2.12 in the upcoming year. Therefore, although payout is expected to increase, the fall in earnings may not equate to higher dividend income.

If there is one thing that you want to be reliable in your life, it’s dividend stocks and their constant income stream. In the case of DEQ it has increased its DPS from €1.05 to €1.45 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. These are all positive signs of a great, reliable dividend stock.

Compared to its peers, Deutsche EuroShop has a yield of 4.57%, which is high for Real Estate stocks.

Next Steps:

With this in mind, I definitely rank Deutsche EuroShop as a strong dividend stock, and makes it worth further research for anyone who likes steady income generation from their 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. I’ve put together three relevant aspects you should further research:

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

2. Valuation: What is DEQ 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 DEQ 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.