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MA Financial Group Limited (ASX:MAF) shares are about to trade ex-dividend in the next few days. The ex-dividend date is one business day before the record date and is the closing date on which a shareholder is on the company’s books and eligible for dividend payments. It is important to note the ex-dividend date, as trades in the stock must be settled on or before the record date. Therefore, if he purchased shares of MA Financial Group after February 27th, he will not be entitled to receive the dividend paid on March 20th.
The company’s next dividend payment will be AU$0.14 per share, and in the last 12 months, the company paid a total of AU$0.20 per share. Looking at last year’s total dividends, MA Financial Group’s yield is 4.5% on the current share price of AU$4.42. We love to see companies pay dividends, but it’s also important to make sure our golden goose doesn’t die by laying golden eggs. That’s why we should always check whether the dividend payments are sustainable, and if the company is growing.
Check out our latest analysis for MA Financial Group.
Dividends are typically paid out of company profits, so if a company pays out more than it earned, its dividend is usually at a higher risk of being cut. MA Financial Group paid out 112% of its profit over the past year, which we generally think is not sustainable unless there are encouraging features, such as unusually strong cash flow or a large cash balance.
Generally, the higher the dividend payout ratio of a company, the higher the risk of a dividend cut.
Click here to see the company’s payout ratio and analyst estimates of its future dividends.
Are profits and dividends growing?
Stocks with flat earnings may still have attractive dividends, but it’s important to be more conservative in your approach and demand a greater margin of safety when it comes to dividend sustainability. Investors love dividends, so if earnings fall and the dividend is cut, you can expect the stock to sell off heavily at the same time. With that in mind, we’re not pleased to see MA Financial Group’s earnings per share have remained essentially flat over the past five years. Sure, it’s better than a stock price going down, but in the long run, all the best dividend stocks can significantly increase his earnings per share.
Another important way to measure a company’s dividend prospects is by measuring its historical dividend growth rate. Over the past six years, MA Financial Group has increased its dividend at an average annual rate of approximately 19%.
conclusion
Is MA Financial Group an attractive dividend stock, or should it be left on the shelf? Earnings per share have not grown at all, and MA Financial Group is paying out an unpleasantly high percentage of its profits as dividends. These characteristics usually do not translate into good dividend performance, and investors may not be happy with the results of owning this stock for its dividend.
However, with that in mind, if you’re unfazed by MA Financial Group’s poor dividend profile, it’s worth being mindful of the risks involved with this business. for that purpose, 3 warning signs We found MA Financial Group (two of which are a bit concerning).
A common investing mistake is buying the first interesting stock you see.can be found here Complete list of high 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 using only unbiased methodologies, and the articles are not intended as financial advice. This is not a recommendation to buy or sell any stock, and does not take into account your objectives or financial situation. We aim to provide long-term, focused analysis based on fundamental data. Note that our analysis may not factor in the latest announcements or qualitative material from price-sensitive companies. Simply Wall St has no position in any stocks mentioned.
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