If you are interested in cashing in on Helical plc’s (LSE:HLCL) upcoming dividend of £0.03 per share, you only have 3 days left to buy the shares before its ex-dividend date, 23 November 2017, in time for dividends payable on the 22 December 2017. Is this future income stream a compelling catalyst for dividend investors to think about HLCL as an investment today? Let’s take a look at HLCL’s most recent financial data to examine its dividend characteristics in more detail. View our latest analysis for Helical
5 checks you should use to assess a dividend stock
Whenever I am looking at a potential dividend stock investment, I always check these five metrics:
- Is it the top 25% annual dividend yield payer?
- Has it consistently paid a stable dividend without missing a payment or drastically cutting payout?
- 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 it have the ability to keep paying its dividends going forward?
Does Helical pass our checks?
Helical has a payout ratio of 129.94%, which means that the dividend is not well-covered by its earnings. However, going forward, analysts expect HLCL’s payout to fall into a more sustainable range of 87.55% of its earnings, which leads to a dividend yield of around 3.22%. Furthermore, EPS should increase to £0.31, meaning that the lower payout ratio does not necessarily implicate a lower dividend payment. If there’s one type of stock you want to be reliable, it’s dividend stocks and their stable income-generating ability. HLCL has increased its DPS from £0.04 to £0.09 in the past 10 years. During this period it has not missed a payment, as one would expect for a company increasing its dividend. This is an impressive feat, which makes HLCL a true dividend rockstar. Relative to peers, Helical produces a yield of 2.88%, which is high for real estate management and development stocks but still below the market’s top dividend payers.
What this means for you:
Are you a shareholder?
Are you a shareholder? With Helical producing strong dividend income for your portfolio over the past few years, you can take comfort in knowing that this stock will still continue to be a robust dividend generator moving forward. But, depending on your current holdings, it may be valuable exploring other income stocks to enhance your diversification, or even look at high-growth stocks to complement your steady income stocks. I suggest continuing your research by exploring my interactive free list of dividend rockstars as well as high-growth stocks to potentially add to your holdings.
Are you a potential investor? Taking into account the dividend metrics, Helical ticks most of the boxes as a strong dividend investment, putting it in my list of top dividend payers. As always, I urge potential investors to try and get a good understanding of the underlying business and its fundamentals before deciding on an investment. No matter how much of a cash cow Helical is, it is not worth an infinite price. Is Helical overvalued or is it actually a bargain? Check our latest free analysis to find out!
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.