Atreyu Capital Markets Ltd (TLV:ATRY) stock is about to trade ex-dividend in three days. Typically, the ex-dividend date is two business days before the record date, which is the date on which a company determines the shareholders eligible to receive a dividend. The ex-dividend date is important as the process of settlement involves at least two full business days. So if you miss that date, you would not show up on the company’s books on the record date. Meaning, you will need to purchase Atreyu Capital Markets’ shares before the 13th of April to receive the dividend, which will be paid on the 20th of April.
The company’s upcoming dividend is ₪2.3771489 a share, following on from the last 12 months, when the company distributed a total of ₪4.24 per share to shareholders. Based on the last year’s worth of payments, Atreyu Capital Markets stock has a trailing yield of around 5.7% on the current share price of ₪74.86. Dividends are an important source of income to many shareholders, but the health of the business is crucial to maintaining those dividends. So we need to investigate whether Atreyu Capital Markets can afford its dividend, and if the dividend could grow.
Dividends are typically paid from company earnings. If a company pays more in dividends than it earned in profit, then the dividend could be unsustainable. Its dividend payout ratio is 80% of profit, which means the company is paying out a majority of its earnings. The relatively limited profit reinvestment could slow the rate of future earnings growth. It could become a concern if earnings started to decline.
Companies that pay out less in dividends than they earn in profits generally have more sustainable dividends. The lower the payout ratio, the more wiggle room the business has before it could be forced to cut the dividend.
View our latest analysis for Atreyu Capital Markets
Click here to see how much of its profit Atreyu Capital Markets paid out over the last 12 months.
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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. Investors love dividends, so if earnings fall and the dividend is reduced, expect a stock to be sold off heavily at the same time. This is why it’s a relief to see Atreyu Capital Markets earnings per share are up 8.4% per annum over the last five years.
Many investors will assess a company’s dividend performance by evaluating how much the dividend payments have changed over time. In the last six years, Atreyu Capital Markets has lifted its dividend by approximately 1.4% a year on average.
The Bottom Line
Should investors buy Atreyu Capital Markets for the upcoming dividend? Earnings per share have been growing at a reasonable rate, and the company is paying out a bit over half its earnings as dividends. It might be worth researching if the company is reinvesting in growth projects that could grow earnings and dividends in the future, but for now we’re on the fence about its dividend prospects.
So if you want to do more digging on Atreyu Capital Markets, you’ll find it worthwhile knowing the risks that this stock faces. For example, we’ve found 2 warning signs for Atreyu Capital Markets (1 is concerning!) that deserve your attention before investing in the shares.
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.
