Future (TSE:4722) Will Pay A Larger Dividend Than Last Year At ¥23.00
Future Corporation (TSE:4722) will increase its dividend to ¥23.00 on September 17, yielding 2.0%, above the industry average. The dividend is well-covered by cash flow and earnings, with a projected payout ratio of 39% next year. Future has a strong dividend history, growing distributions at an annual rate of 19% over the past decade. With EPS growth of 13.9% expected next year, Future is positioned as an attractive income stock with solid potential for future dividend growth.
Future Corporation's (TSE:4722) dividend will be increasing from last year's payment of the same period to ¥23.00 on 17th of September. This makes the dividend yield 2.0%, which is above the industry average.
We've found 21 US stocks that are forecast to pay a dividend yield of over 6% next year. See the full list for free.
Future's Payment Could Potentially Have Solid Earnings Coverage
While it is great to have a strong dividend yield, we should also consider whether the payment is sustainable. However, prior to this announcement, Future's dividend was comfortably covered by both cash flow and earnings. This means that most of what the business earns is being used to help it grow.
The next year is set to see EPS grow by 13.9%. Assuming the dividend continues along recent trends, we think the payout ratio could be 39% by next year, which is in a pretty sustainable range.
View our latest analysis for Future
Future Has A Solid Track Record
The company has been paying a dividend for a long time, and it has been quite stable which gives us confidence in the future dividend potential. The annual payment during the last 10 years was ¥8.00 in 2015, and the most recent fiscal year payment was ¥46.00. This implies that the company grew its distributions at a yearly rate of about 19% over that duration. Rapidly growing dividends for a long time is a very valuable feature for an income stock.
The Dividend Looks Likely To Grow
Some investors will be chomping at the bit to buy some of the company's stock based on its dividend history. Future has impressed us by growing EPS at 17% per year over the past five years. With a decent amount of growth and a low payout ratio, we think this bodes well for Future's prospects of growing its dividend payments in the future.
We Really Like Future's Dividend
Overall, we think this could be an attractive income stock, and it is only getting better by paying a higher dividend this year. Earnings are easily covering distributions, and the company is generating plenty of cash. All of these factors considered, we think this has solid potential as a dividend stock.
Companies possessing a stable dividend policy will likely enjoy greater investor interest than those suffering from a more inconsistent approach. At the same time, there are other factors our readers should be conscious of before pouring capital into a stock. Earnings growth generally bodes well for the future value of company dividend payments. See if the 3 Future analysts we track are forecasting continued growth with our free report on analyst estimates for the company. Is Future not quite the opportunity you were looking for? Why not check out our selection of top dividend stocks.
