Income Investors Should Know That Administradora de Fondos de Pensiones Habitat S.A. (SNSE:HABITAT) Goes Ex-Dividend Soon

Administradora de Fondos de Pensiones Habitat S.A. (SNSE:HABITAT) is about to trade ex-dividend in the next three days. The ex-dividend date generally occurs two days before the record date, which is the day on which shareholders need to be on the company's books in order to receive a dividend. The ex-dividend date is important as the process of settlement involves at least two full business days. So if you miss that date, you would not show up on the company's books on the record date. Thus, you can purchase Administradora de Fondos de Pensiones Habitat's shares before the 5th of January in order to receive the dividend, which the company will pay on the 9th of January.

The company's next dividend payment will be CL$20.00 per share, on the back of last year when the company paid a total of CL$110 to shareholders. Calculating the last year's worth of payments shows that Administradora de Fondos de Pensiones Habitat has a trailing yield of 6.2% on the current share price of CL$1522.20. Dividends are a major contributor to investment returns for long term holders, but only if the dividend continues to be paid. We need to see whether the dividend is covered by earnings and if it's growing.

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Dividends are typically paid from company earnings. If a company pays more in dividends than it earned in profit, then the dividend could be unsustainable. Administradora de Fondos de Pensiones Habitat paid out 61% of its earnings to investors last year, a normal payout level for most businesses.

Generally speaking, the lower a company's payout ratios, the more resilient its dividend usually is.

View our latest analysis for Administradora de Fondos de Pensiones Habitat

Click here to see how much of its profit Administradora de Fondos de Pensiones Habitat paid out over the last 12 months.

Have Earnings And Dividends Been Growing?

Businesses with strong growth prospects usually make the best dividend payers, because it's easier to grow dividends when earnings per share are improving. Investors love dividends, so if earnings fall and the dividend is reduced, expect a stock to be sold off heavily at the same time. With that in mind, we're encouraged by the steady growth at Administradora de Fondos de Pensiones Habitat, with earnings per share up 3.0% on average over the last five years.

The main way most investors will assess a company's dividend prospects is by checking the historical rate of dividend growth. Administradora de Fondos de Pensiones Habitat has delivered 5.6% dividend growth per year on average over the past 10 years. It's encouraging to see the company lifting dividends while earnings are growing, suggesting at least some corporate interest in rewarding shareholders.

The Bottom Line

Is Administradora de Fondos de Pensiones Habitat worth buying for its dividend? Earnings per share have been growing at a reasonable rate, and the company is paying out a bit over half its earnings as dividends. It doesn't appear an outstanding opportunity, but could be worth a closer look.

So if you want to do more digging on Administradora de Fondos de Pensiones Habitat, you'll find it worthwhile knowing the risks that this stock faces. Every company has risks, and we've spotted 1 warning sign for Administradora de Fondos de Pensiones Habitat you should know about.

If you're in the market for strong dividend payers, we recommend checking our selection of top 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.