Read This Before Buying Mondelez International Inc (NASDAQ:MDLZ) For Its Upcoming US$0.22 Dividend

Important news for shareholders and potential investors in Mondelez International Inc (NASDAQ:MDLZ): The dividend payment of US$0.22 per share will be distributed into shareholder on 13 July 2018, and the stock will begin trading ex-dividend at an earlier date, 28 June 2018. Investors looking for higher income-generating stocks to add to their portfolio should keep reading, as I take a deeper dive into Mondelez International’s latest financial data to analyse its dividend attributes. See our latest analysis for Mondelez International

5 checks you should use to assess a dividend stock

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

• Is it the top 25% annual dividend yield payer?

• 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?

NasdaqGS:MDLZ Historical Dividend Yield June 25th 18

Does Mondelez International pass our checks?

Mondelez International has a trailing twelve-month payout ratio of 39.55%, which means that the dividend is covered by earnings. Going forward, analysts expect MDLZ’s payout to remain around the same level at 40.01% of its earnings, which leads to a dividend yield of around 2.42%. Furthermore, EPS should increase to $2.44.

If there’s one type of stock you want to be reliable, it’s dividend stocks and their stable income-generating ability. Dividend payments from Mondelez International have been volatile in the past 10 years, with some years experiencing significant drops of over 25%. These characteristics do not bode well for income investors seeking reliable stream of dividends.

Compared to its peers, Mondelez International has a yield of 2.13%, which is on the low-side for Food stocks.

Next Steps:

If you are building an income portfolio, then Mondelez International is a complicated choice since it has some positive aspects as well as negative ones. However, if you are not strictly just a dividend investor, the stock could still offer some interesting investment opportunities. 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 fundamental aspects you should further examine:

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

2. Valuation: What is MDLZ 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 MDLZ is currently mispriced by the market.

3. 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.