Yahoo Finance Firm Capital Mortgage Investment (TSE:FC) Is Paying Out A Dividend Of CA$0.092
Firm Capital Mortgage Investment Corporation (TSE:FC) has announced that it will pay a dividend of CA$0.092 per share on the 16th of January. The dividend yield will be 8.8% based on this payment which is still above the industry average.
See our latest analysis for Firm Capital Mortgage Investment
Firm Capital Mortgage Investment Will Pay Out More Than It Is Earning
A big dividend yield for a few years doesn't mean much if it can't be sustained.
Firm Capital Mortgage Investment has established itself as a dividend paying company with over 10 years history of distributing earnings to shareholders. While there are no guarantees that Firm Capital Mortgage Investment will always be able to pay out a dividend, the company's payout ratio sits at 99%. This figure could be worrying with regards to the sustainability of the company's dividends, as earnings just barely cover its dividend payments.
EPS is set to fall by 2.0% over the next 12 months if recent trends continue. Future analyst estimates of the payout ratio also put it at 97% in 3 years, which means they expect the dividend to be under pressure with weakened earnings forecasts.
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 dividend has gone from an annual total of CA$0.99 in 2012 to the most recent total annual payment of CA$0.948. Payments have been decreasing at a very slow pace in this time period. Declining dividends isn't generally what we look for as they can indicate that the company is running into some challenges.
Dividend Growth May Be Hard To Achieve
Growing earnings per share could be a mitigating factor when considering the past fluctuations in the dividend. Although it's important to note that Firm Capital Mortgage Investment's earnings per share has basically not grown from where it was five years ago, which could erode the purchasing power of the dividend over time.
Firm Capital Mortgage Investment's Dividend Doesn't Look Great
Overall, while some might be pleased that the dividend wasn't cut, we think this may help Firm Capital Mortgage Investment make more consistent payments in the future. The company isn't making enough to be paying as much as it is, and the other factors don't look particularly promising either. Overall, the dividend is not reliable enough to make this a good income stock.
Companies possessing a stable dividend policy will likely enjoy greater investor interest than those suffering from a more inconsistent approach. However, there are other things to consider for investors when analysing stock performance. To that end, Firm Capital Mortgage Investment has 2 warning signs (and 1 which can't be ignored) we think you should know about. Looking for more high-yielding dividend ideas? Try our collection of strong dividend payers.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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