Happinet (TSE:7552) Has Affirmed Its Dividend Of ¥25.00
Happinet Corporation (TSE:7552) has confirmed a dividend of ¥25.00 per share, yielding 2.2%, payable on December 8. The company's earnings are projected to cover future distributions, with a potential 40.7% rise in earnings per share next year. Despite past dividend cuts, Happinet has shown a 41% annual growth in EPS over the last five years, indicating a strong dividend-paying potential. Overall, the company appears to be a solid choice for dividend investors, although caution is advised due to one identified warning sign.
The board of Happinet Corporation (TSE:7552) has announced that it will pay a dividend of ¥25.00 per share on the 8th of December. This means the dividend yield will be fairly typical at 2.2%.
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Happinet's Projected Earnings Seem Likely To Cover Future Distributions
Solid dividend yields are great, but they only really help us if the payment is sustainable. The last dividend was quite easily covered by Happinet's earnings. This indicates that quite a large proportion of earnings is being invested back into the business.
Looking forward, earnings per share could rise by 40.7% over the next year if the trend from the last few years continues. Assuming the dividend continues along recent trends, we think the payout ratio could be 35% by next year, which is in a pretty sustainable range.
View our latest analysis for Happinet
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 ¥27.00 in 2015, and the most recent fiscal year payment was ¥130.00. This implies that the company grew its distributions at a yearly rate of about 17% over that duration. It is great to see strong growth in the dividend payments, but cuts are concerning as it may indicate the payout policy is too ambitious.
The Dividend Looks Likely To Grow
With a relatively unstable dividend, it's even more important to see if earnings per share is growing. Happinet has seen EPS rising for the last five years, at 41% per annum. The company's earnings per share has grown rapidly in recent years, and it has a good balance between reinvesting and paying dividends to shareholders, so we think that Happinet could prove to be a strong dividend payer.
Happinet Looks Like A Great Dividend Stock
Overall, we like to see the dividend staying consistent, and we think Happinet might even raise payments in the future. Distributions are quite easily covered by earnings, which are also being converted to cash flows. All in all, this checks a lot of the boxes we look for when choosing an income 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. Taking the debate a bit further, we've identified 1 warning sign for Happinet that investors need to be conscious of moving forward. Is Happinet not quite the opportunity you were looking for? Why not check out our selection of top dividend stocks.
