Investors who want to cash in on Plastiques du Val de Loire's (EPA:PVL) upcoming dividend of €0.20 per share have only 1 days left to buy the shares before its ex-dividend date, 18 April 2019, in time for dividends payable on the 24 April 2019. Investors looking for higher income-generating stocks to add to their portfolio should keep reading, as I examine Plastiques du Val de Loire's latest financial data to analyse its dividend characteristics.
5 checks you should do on a dividend stock
Whenever I am looking at a potential dividend stock investment, I always check these five metrics:
- Is it paying an annual yield above 75% of dividend payers?
- Has it paid dividend every year without dramatically reducing payout in the past?
- Has dividend per share risen in the past couple of years?
- Is is 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?
How does Plastiques du Val de Loire fare?
The company currently pays out 11% of its earnings as a dividend, according to its trailing twelve-month data, meaning the dividend is sufficiently covered by earnings. Going forward, analysts expect PVL's payout to remain around the same level at 11% of its earnings. Assuming a constant share price, this equates to a dividend yield of 2.3%. In addition to this, EPS is forecasted to fall to €1.71 in the upcoming year.
If you want to dive deeper into the sustainability of a certain payout ratio, you may wish to consider the cash flow of the business. Companies with strong cash flow can sustain a higher payout ratio, while companies with weaker cash flow generally cannot.
If dividend is a key criteria in your investment consideration, then you need to make sure the dividend stock you're eyeing out is reliable in its payments. Although PVL's per share payments have increased in the past 10 years, it has not been a completely smooth ride. Shareholders would have seen a few years of reduced payments in this time.
In terms of its peers, Plastiques du Val de Loire has a yield of 2.1%, which is on the low-side for Chemicals stocks.
With these dividend metrics in mind, I definitely rank Plastiques du Val de Loire as a strong income stock, and is worth further research for anyone who considers dividends an important part of their portfolio strategy. 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. Below, I've compiled three pertinent aspects you should look at:
- Future Outlook: What are well-informed industry analysts predicting for PVL’s future growth? Take a look at our free research report of analyst consensus for PVL’s outlook.
- Valuation: What is PVL 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 PVL 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.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at email@example.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.