Yamaguchi Financial Group's (TSE:8418) Dividend Will Be ¥32.00

The board of Yamaguchi Financial Group, Inc. (TSE:8418) has announced that it will pay a dividend on the 15th of June, with investors receiving ¥32.00 per share. The payment will take the dividend yield to 3.1%, which is in line with the average for the industry.

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Yamaguchi Financial Group's Dividend Forecasted To Be Well Covered By Earnings

Unless the payments are sustainable, the dividend yield doesn't mean too much.

Having distributed dividends for at least 10 years, Yamaguchi Financial Group has a long history of paying out a part of its earnings to shareholders. Taking data from its last earnings report, calculating for the company's payout ratio shows 32%, which means that Yamaguchi Financial Group would be able to pay its last dividend without pressure on the balance sheet.

The next year is set to see EPS grow by 5.0%. If the dividend continues on this path, the future payout ratio could be 36% by next year, which we think can be pretty sustainable going forward.

See our latest analysis for Yamaguchi Financial Group

Yamaguchi Financial Group Has A Solid Track Record

The company has an extended history of paying stable dividends. Since 2015, the dividend has gone from ¥14.00 total annually to ¥64.00. This means that it has been growing its distributions at 16% per annum over that time. Rapidly growing dividends for a long time is a very valuable feature for an income stock.

The Dividend Looks Likely To Grow

The company's investors will be pleased to have been receiving dividend income for some time. Yamaguchi Financial Group has seen EPS rising for the last five years, at 18% per annum. Growth in EPS bodes well for the dividend, as does the low payout ratio that the company is currently reporting.

We Really Like Yamaguchi Financial Group's Dividend

In summary, it is always positive to see the dividend being increased, and we are particularly pleased with its overall sustainability. Earnings are easily covering distributions, and the company is generating plenty of cash. All in all, this checks a lot of the boxes we look for when choosing an income stock.

Investors generally tend to favour companies with a consistent, stable dividend policy as opposed to those operating an irregular one. However, there are other things to consider for investors when analysing stock performance. You can also discover whether shareholders are aligned with insider interests by checking our visualisation of insider shareholdings and trades in Yamaguchi Financial Group stock. Looking for more high-yielding dividend ideas? Try our collection of strong dividend payers.

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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.