Yahoo Finance John Laing Group plc (LON:JLG) Will Pay UK£0.018 In Dividends
On the 26 October 2018, John Laing Group plc (LON:JLG) will be paying shareholders an upcoming dividend amount of UK£0.018 per share. However, investors must have bought the company’s stock before 27 September 2018 in order to qualify for the payment. That means you have only 4 days left! Is this future income stream a compelling catalyst for dividend investors to think about the stock as an investment today? Let’s take a look at John Laing Group’s most recent financial data to examine its dividend characteristics in more detail.
View our latest analysis for John Laing Group
How I analyze a dividend stock
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 consistently paid a stable dividend without missing a payment or drastically cutting payout?
Has it increased its dividend per share amount over the past?
Is is able to pay the current rate of dividends from its earnings?
Will it have the ability to keep paying its dividends going forward?
How does John Laing Group fare?
John Laing Group has a trailing twelve-month payout ratio of 8.7%, which means that the dividend is covered by earnings. Going forward, analysts expect JLG’s payout to increase to 21.1% of its earnings, which leads to a dividend yield of 3.1%. However, EPS is forecasted to fall to £0.50 in the upcoming year. Therefore, although payout is expected to increase, the fall in earnings may not equate to higher dividend income.
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.
If there’s one type of stock you want to be reliable, it’s dividend stocks and their stable income-generating ability. Unfortunately, it is really too early to view John Laing Group as a dividend investment. It has only been consistently paying dividends for 3 years, however, standard practice for reliable payers is to look for a 10-year minimum track record.
Relative to peers, John Laing Group produces a yield of 3.4%, which is on the low-side for Construction stocks.
Next Steps:
If you are building an income portfolio, then John Laing Group is a complicated choice since it has some positive aspects as well as negative ones. But if you are not exclusively a dividend investor, the stock could still be an interesting investment opportunity. 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. I’ve put together three key aspects you should further research:
Future Outlook: What are well-informed industry analysts predicting for JLG’s future growth? Take a look at our free research report of analyst consensus for JLG’s outlook.
Valuation: What is JLG 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 JLG is currently mispriced by the market.
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.
