CITIC Limited (HKG:267): Ex-Dividend Is In 2 Days, Should You Buy?

Investors who want to cash in on CITIC Limited’s (SEHK:267) upcoming dividend of HK$0.25 per share have only 2 days left to buy the shares before its ex-dividend date, 19 June 2018, in time for dividends payable on the 05 July 2018. What does this mean for current shareholders and potential investors? Below, I will explain how holding CITIC can impact your portfolio income stream, by analysing the stock’s most recent financial data and dividend attributes. Check out our latest analysis for CITIC

5 questions to ask before buying 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?

• Is its earnings sufficient to payout dividend at the current rate?

• Will it have the ability to keep paying its dividends going forward?

SEHK:267 Historical Dividend Yield Jun 16th 18

Does CITIC pass our checks?

The company currently pays out 23.85% of its earnings as a dividend, according to its trailing twelve-month data, which means that the dividend is covered by earnings. Going forward, analysts expect 267’s payout to remain around the same level at 23.50% of its earnings, which leads to a dividend yield of 3.48%. Moreover, EPS should increase to HK$1.65. If there’s one type of stock you want to be reliable, it’s dividend stocks and their stable income-generating ability. Not only have dividend payouts from CITIC fallen over the past 10 years, it has also been highly volatile during this time, with drops of over 25% in some years. These characteristics do not bode well for income investors seeking reliable stream of dividends. Relative to peers, CITIC generates a yield of 3.10%, which is on the low-side for Industrials stocks.

Next Steps:

If you are building an income portfolio, then CITIC is a complicated choice since it has some positive aspects as well as negative ones. However, if you are not strictly just a dividend investor, the stock could still offer some interesting investment opportunities. Given that this is purely a dividend analysis, I urge potential investors to try and get a good understanding of the underlying business and its fundamentals before deciding on an investment. Below, I’ve compiled three pertinent factors you should further research:

1. Future Outlook: What are well-informed industry analysts predicting for 267’s future growth? Take a look at our free research report of analyst consensus for 267’s outlook.

2. Historical Performance: What has 267’s returns been like over the past? Go into more detail in the past track record analysis and take a look at the free visual representations of our analysis for more clarity.

3. 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.