Hatsun Agro Product Limited (NSE: HATSUN) looks like a good stock, and it will be ex-dividend soon
Readers wishing to buy Hatsun Agro Product Limited (NSE: HATSUN) for its dividend will have to act shortly, as the stock is about to trade ex-dividend. The ex-dividend date is one working day before the registration date, which is the deadline by which shareholders must be present on the books of the company to be eligible for the payment of a dividend. The ex-dividend date is important because every time a stock is bought or sold, the transaction takes at least two business days to settle. Therefore, if you buy Hatsun Agro Product shares on or after July 22, you will not be eligible to receive the dividend, when it is paid on August 13.
The company’s next dividend payment will be 6.00 per share, and over the past 12 months, the company has paid a total of 6.00 per share. Calculating the value of last year’s payouts shows that Hatsun Agro Product has a 0.6% return on the current share price of 972.052. If you buy this company for its dividend, you should know whether the dividend of Hatsun Agro Product is reliable and sustainable. That is why we should always check whether dividend payments seem sustainable and whether the business is growing.
See our latest review for Hatsun Agro
Dividends are generally paid out of company profits. If a company pays more dividends than it made a profit, then the dividend could be unsustainable. This is why it is good to see Hatsun Agro Product donate a modest 26% of its income.
Click here to see how much of its profit Hatsun Agro Product paid in the last 12 months.
Have profits and dividends increased?
Companies with strong growth prospects generally make the best dividend payers because dividends are easier to grow when earnings per share improve. If business goes into recession and the dividend is reduced, the business could experience a sharp drop in value. It is encouraging to see that Hatsun Agro Product has rapidly increased its revenue, increasing by 31% per year over the past five years. Earnings per share have grown very rapidly, and the company pays out a relatively small percentage of its earnings and cash flow. Companies with increasing profits and low payout ratios are often the best long-term dividend-paying stocks, as the company can both increase profits and increase the percentage of profits it pays out, essentially multiplying the dividend. .
Most investors primarily assess a company’s dividend prospects by checking the historical rate of dividend growth. Since our data began nine years ago, Hatsun Agro Product has increased its dividend by around 34% per year on average. It is exciting to see that earnings and dividends per share have grown rapidly over the past few years.
Does Hatsun Agro Product have what it takes to maintain its dividend payments? Typically, companies that grow rapidly and pay a small fraction of the profits keep the profits to reinvest in the business. This strategy can bring significant added value to shareholders over the long term, provided it is applied without issuing too many new shares. We think this is a pretty attractive combination and would be interested in taking a closer look at Hatsun Agro Product.
Although it is tempting to invest in Hatsun Agro Product purely for dividends, you should always be aware of the risks involved. For example, we found 2 warning signs for the product Hatsun Agro which we recommend that you consider before investing in the business.
However, we don’t recommend simply buying the first dividend stock you see. Here is a list of interesting dividend paying stocks with a yield above 2% and a dividend coming soon.
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This Simply Wall St article is general in nature. It does not constitute a recommendation to buy or sell shares and does not take into account your goals or your financial situation. Our aim is to bring you long-term, targeted analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price sensitive companies or qualitative documents. Simply Wall St has no position in any of the stocks mentioned.
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