The Hong Kong and China Gas Company Limited (HKG:3): What You Have To Know Before Buying For The Upcoming Dividend

If you are interested in cashing in on The Hong Kong and China Gas Company Limited’s (SEHK:3) upcoming dividend of HK$0.23 per share, you only have 3 days left to buy the shares before its ex-dividend date, 08 June 2018, in time for dividends payable on the 22 June 2018. Is this future income a persuasive enough catalyst for investors to think about Hong Kong and China Gas as an investment today? Below, I’m going to look at the latest data and analyze the stock and its dividend property in further detail. Check out our latest analysis for Hong Kong and China Gas

Here’s how I find good dividend stocks

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

• Does it pay an annual yield higher than 75% of dividend payers?

• Has it paid dividend every year without dramatically reducing payout in the past?

• Has dividend per share amount increased over the past?

• Is it 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?

SEHK:3 Historical Dividend Yield Jun 4th 18

How well does Hong Kong and China Gas fit our criteria?

Hong Kong and China Gas has a trailing twelve-month payout ratio of 59.52%, meaning the dividend is sufficiently covered by earnings. Going forward, analysts expect 3’s payout to remain around the same level at 64.05% of its earnings, which leads to a dividend yield of 2.29%. Moreover, EPS is forecasted to fall to HK$0.59 in the upcoming year. If there’s one type of stock you want to be reliable, it’s dividend stocks and their stable income-generating ability. Whilst its per-share payments have increased during the past 10 years, there has been some hiccups. Shareholders would have seen a few years of reduced payments in this time. In terms of its peers, Hong Kong and China Gas produces a yield of 2.06%, which is high for Gas Utilities stocks but still below the market’s top dividend payers.

Next Steps:

Considering the dividend attributes we analyzed above, Hong Kong and China Gas is definitely worth keeping an eye on for someone looking to build a dedicated income portfolio. Given that this is purely a dividend analysis, I recommend taking sufficient time to understand its core business and determine whether the company and its investment properties suit your overall goals. I’ve put together three fundamental factors you should further research:

1. Future Outlook: What are well-informed industry analysts predicting for 3’s future growth? Take a look at our free research report of analyst consensus for 3’s outlook.

2. Valuation: What is 3 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 3 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.