3 Days Left Before China Resources Power Holdings Company Limited (HKG:836) Will Start Trading Ex-Dividend, Should Investors Buy?

If you are interested in cashing in on China Resources Power Holdings Company Limited’s (SEHK:836) upcoming dividend of HK$0.75 per share, you only have 3 days left to buy the shares before its ex-dividend date, 15 June 2018, in time for dividends payable on the 05 July 2018. Is this future income a persuasive enough catalyst for investors to think about China Resources Power Holdings as an investment today? Below, I’m going to look at the latest data and analyze the stock and its dividend property in further detail. Check out our latest analysis for China Resources Power Holdings

5 checks you should do on a dividend stock

If you are a dividend investor, you should always assess these five key metrics:

• Is its annual yield among the top 25% of dividend-paying companies?

• Does it consistently pay out dividends without missing a payment of significantly cutting payout?

• Has dividend per share risen in the past couple of years?

• Does earnings amply cover its dividend payments?

• Based on future earnings growth, will it be able to continue to payout dividend at the current rate?

SEHK:836 Historical Dividend Yield Jun 11th 18

How well does China Resources Power Holdings fit our criteria?

The current trailing twelve-month payout ratio for 836 is 90.42%, which means that the dividend is not well-covered by its earnings. However, going forward, analysts expect 836’s payout to fall into a more sustainable range of 48.44% of its earnings, which leads to a dividend yield of 5.71%. Furthermore, EPS should increase to HK$1.44, meaning that the lower payout ratio does not necessarily implicate a lower dividend payment. If dividend is a key criteria in your investment consideration, then you need to make sure the dividend stock you’re eyeing out is reliable in its payments. Although 836’s per share payments have increased in the past 10 years, it has not been a completely smooth ride. Investors have seen reductions in the dividend per share in the past, although, it has picked up again. Relative to peers, China Resources Power Holdings generates a yield of 5.57%, which is high for Renewable Energy stocks.

Next Steps:

With this in mind, I definitely rank China Resources Power Holdings as a strong dividend stock, and makes it worth further research for anyone who likes steady income generation from their portfolio. Given that this is purely a dividend analysis, you should always research extensively before deciding whether or not a stock is an appropriate investment for you. I always recommend analysing the company’s fundamentals and underlying business before making an investment decision. Below, I’ve compiled three fundamental aspects you should further examine:

1. Future Outlook: What are well-informed industry analysts predicting for 836’s future growth? Take a look at our free research report of analyst consensus for 836’s outlook.

2. Valuation: What is 836 worth today? Even if the stock is a cash cow, it’s not worth an infinite price. The intrinsic value infographic in our free research report helps visualize whether 836 is currently mispriced by the market.

3. Other Dividend Rockstars: Are there better dividend payers with stronger fundamentals out there? Check out our free list of these great stocks here.

To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned.