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華爾街日報Miyazaki Bank (TSE:8393) Is Due To Pay A Dividend Of ¥90.00
The Miyazaki Bank, Ltd.'s (TSE:8393) investors are due to receive a payment of ¥90.00 per share on 29th of June. Even though the dividend went up, the yield is still quite low at only 1.9%.
While the dividend yield is important for income investors, it is also important to consider any large share price moves, as this will generally outweigh any gains from distributions. Investors will be pleased to see that Miyazaki Bank's stock price has increased by 82% in the last 3 months, which is good for shareholders and can also explain a decrease in the dividend yield.
Miyazaki Bank's Payment Expected To Have Solid Earnings Coverage
It would be nice for the yield to be higher, but we should also check if higher levels of dividend payment would be sustainable.
Having distributed dividends for at least 10 years, Miyazaki Bank has a long history of paying out a part of its earnings to shareholders. While past records don't necessarily translate into future results, the company's payout ratio of 21% also shows that Miyazaki Bank is able to comfortably pay dividends.
Over the next year, EPS could expand by 8.2% if recent trends continue. If the dividend continues along recent trends, we estimate the future payout ratio will be 24%, which is in the range that makes us comfortable with the sustainability of the dividend.
View our latest analysis for Miyazaki Bank
Dividend Volatility
While the company has been paying a dividend for a long time, it has cut the dividend at least once in the last 10 years. The annual payment during the last 10 years was ¥80.00 in 2016, and the most recent fiscal year payment was ¥180.00. This means that it has been growing its distributions at 8.4% per annum over that time. It's good to see the dividend growing at a decent rate, but the dividend has been cut at least once in the past. Miyazaki Bank might have put its house in order since then, but we remain cautious.
Miyazaki Bank Could Grow Its Dividend
With a relatively unstable dividend, it's even more important to evaluate if earnings per share is growing, which could point to a growing dividend in the future. Miyazaki Bank has impressed us by growing EPS at 8.2% per year over the past five years. With a decent amount of growth and a low payout ratio, we think this bodes well for Miyazaki Bank's prospects of growing its dividend payments in the future.
Miyazaki Bank Looks Like A Great Dividend Stock
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. Meanwhile, despite the importance of dividend payments, they are not the only factors our readers should know when assessing a company. Taking the debate a bit further, we've identified 1 warning sign for Miyazaki Bank that investors need to be conscious of moving forward. If you are a dividend investor, you might also want to look at our curated 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.