China Railway Harbin Group of Technology Corporation (SHSE:688459) is scheduled to trade ex-dividend within the next 3 days. The ex-dividend date is usually set one business day before the record date. The record date is the cut-off date by which you must be on the company’s books as a shareholder to receive the dividend. The record date is important because it takes two full business days for the settlement process. So if you miss that date, you won’t be on the company’s books on the record date. So you can buy China Railway Harbin Group of Technology shares before June 27th to receive the dividend the company will pay on June 27th.
The company’s next dividend will be CNY0.10 per share, and in the last 12 months the company has paid a total of CNY0.10 per share. Last year’s total dividends represent a dividend yield of 1.1% on China Railway Harbin Group of Technology’s current share price of CNY8.70. While it’s nice to see companies pay dividends, it’s also important to ensure that they don’t kill the golden eggs by laying them. Therefore, readers should always check whether China Railway Harbin Group of Technology has managed to grow its dividends, or whether its dividend might be cut.
Check out our latest analysis for China Railway Harbin Technology Group
Dividends are typically paid from company profits. If a company pays more in dividends than it earns, the dividend may be unsustainable. China Railway Harbin Technology Group paid out 42% of its profits as dividends last year. However, cash flow is more important than profits for assessing a dividend, so we need to see if a company generated enough cash to pay its dividend. Happily, it paid out only 44% of its free cash flow last year.
It’s good to see that China Railway Harbin Science and Technology Group’s dividends are covered by both profits and cash flow, this is generally a sign that the dividend is sustainable, and a lower payout ratio usually suggests a greater margin of safety before the dividend gets cut.
You can click here to see how much of its profit China Railway Harbin Science and Technology Group paid out over the last 12 months.
SHSE:688459 June 23, 2024 Highest dividend ever
Are profits and dividends increasing?
Companies with shrinking profits are tricky from a dividend perspective. If profits fall substantially, a company may be forced to cut the dividend. China Railway Harbin Science and Technology Group’s earnings per share have fallen by about 16% per year over the past five years. Such a sharp decline calls into question the future sustainability of the dividend.
Unfortunately, China Railway Harbin Technology Group has only been paying a dividend for around a year, so there isn’t much of a history from which to draw insights.
Conclusion
Should investors buy China Railway Harbin Technology Group for its upcoming dividends? China Railway Harbin Technology Group’s cash and earnings payout ratios are low enough that this could mean that the dividend is sustainable even in the face of a sharp decline in earnings per share. Still, we think the decline in earnings is a warning sign. Overall, it’s hard to get excited about China Railway Harbin Technology Group from a dividend perspective.
With that in mind, an important part of thorough stock research is to be aware of any risks that the stock is currently facing, and to help with this, we’ve spotted 1 warning sign for China Railway Harbin Group of Technology that you should be aware of before investing in stock.
A common mistake in investing is buying the first interesting stock you see. Here you can find the complete list of high dividend stocks.
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This article by Simply Wall St is of general nature. We provide commentary based on historical data and analyst forecasts using only unbiased methodology, and our articles are not intended as financial advice. It is not a recommendation to buy or sell stocks, and does not take into account your objectives or financial situation. We aim to provide long-term analysis driven by fundamental data. Please note that our analysis may not take into account the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any of the stocks mentioned herein.
Valuation is complicated, but we can help make it simple.
Find out whether China Railway Harbin Technology Group is potentially overvalued or undervalued by checking our comprehensive analysis, including fair value estimates, risks and warnings, dividends, insider transactions, financial position and more.
View your free analysis
Have something to say about this article? If you have any questions about the content, please contact us directly or email us at editorial-team@simplywallst.com.
