Yahoo Finance Only 3 Days Left To Cash In On Britvic plc (LON:BVIC) Dividend
Shares of Britvic plc (LON:BVIC) will begin trading ex-dividend in 3 days. To qualify for the dividend check of UK£0.20 per share, investors must have owned the shares prior to 06 December 2018, which is the last day the company’s management will finalize their list of shareholders to which they will send dividend payments. Investors looking for higher income-generating stocks to add to their portfolio should keep reading, as I examine Britvic’s latest financial data to analyse its dividend characteristics.
Check out our latest analysis for Britvic
Here’s how I find good dividend stocks
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?
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 its earnings sufficient to payout dividend at the current rate?
Based on future earnings growth, will it be able to continue to payout dividend at the current rate?
How well does Britvic fit our criteria?
Britvic has a trailing twelve-month payout ratio of 64%, meaning the dividend is sufficiently covered by earnings. However, going forward, analysts expect BVIC’s payout to fall to 50% of its earnings, which leads to a dividend yield of 3.7%. However, EPS should increase to £0.52, meaning that the lower payout ratio does not necessarily implicate a lower dividend payment.
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.
Reliablity is an important factor for dividend stocks, particularly for income investors who want a strong track record of payment and a positive outlook for future payout. In the case of BVIC it has increased its DPS from £0.13 to £0.28 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, Britvic produces a yield of 3.3%, which is high for Beverage stocks but still below the market’s top dividend payers.
Next Steps:
With this in mind, I definitely rank Britvic 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. There are three relevant factors you should further research:
Future Outlook: What are well-informed industry analysts predicting for BVIC’s future growth? Take a look at our free research report of analyst consensus for BVIC’s outlook.
Valuation: What is BVIC 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 BVIC 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.
