Yahoo Finance Just Three Days Till Public Policy Holding Company, Inc. (LON:PPHC) Will Be Trading Ex-Dividend
Public Policy Holding Company, Inc. (LON:PPHC) is about to trade ex-dividend in the next 3 days. The ex-dividend date is usually set to be one business day before the record date which is the cut-off date on which you must be present on the company's books as a shareholder in order to receive the dividend. The ex-dividend date is of consequence because whenever a stock is bought or sold, the trade takes at least two business day to settle. Thus, you can purchase Public Policy Holding Company's shares before the 4th of May in order to receive the dividend, which the company will pay on the 2nd of June.
The company's next dividend payment will be US$0.095 per share, and in the last 12 months, the company paid a total of US$0.14 per share. Based on the last year's worth of payments, Public Policy Holding Company stock has a trailing yield of around 8.1% on the current share price of £1.37. We love seeing companies pay a dividend, but it's also important to be sure that laying the golden eggs isn't going to kill our golden goose! So we need to check whether the dividend payments are covered, and if earnings are growing.
See our latest analysis for Public Policy Holding Company
Dividends are usually paid out of company profits, so if a company pays out more than it earned then its dividend is usually at greater risk of being cut. Public Policy Holding Company reported a loss after tax last year, which means it's paying a dividend despite being unprofitable. While this might be a one-off event, this is unlikely to be sustainable in the long term. Given that the company reported a loss last year, we now need to see if it generated enough free cash flow to fund the dividend. If Public Policy Holding Company didn't generate enough cash to pay the dividend, then it must have either paid from cash in the bank or by borrowing money, neither of which is sustainable in the long term. It distributed 27% of its free cash flow as dividends, a comfortable payout level for most companies.
Click here to see how much of its profit Public Policy Holding Company paid out over the last 12 months.
Have Earnings And Dividends Been Growing?
Companies with consistently growing earnings per share generally make the best dividend stocks, as they usually find it easier to grow dividends per share. If earnings decline and the company is forced to cut its dividend, investors could watch the value of their investment go up in smoke. Public Policy Holding Company was unprofitable last year, although, we can see that at least its loss per share reduced by 43% on the previous year.
One year is a very short time frame in the pantheon of investing, so we wouldn't get too hung up on these numbers.
Given that Public Policy Holding Company has only been paying a dividend for a year, there's not much of a past history to draw insight from.
We update our analysis on Public Policy Holding Company every 24 hours, so you can always get the latest insights on its financial health, here.
The Bottom Line
Should investors buy Public Policy Holding Company for the upcoming dividend? We're a bit uncomfortable with it paying a dividend while being loss-making. However, we note that the dividend was covered by cash flow. To summarise, Public Policy Holding Company looks okay on this analysis, although it doesn't appear a stand-out opportunity.
With that in mind, a critical part of thorough stock research is being aware of any risks that stock currently faces. Be aware that Public Policy Holding Company is showing 2 warning signs in our investment analysis, and 1 of those doesn't sit too well with us...
A common investing mistake is buying the first interesting stock you see. Here you can find a full list of high-yield dividend stocks.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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