Just Three Days Till MarketWise, Inc. (NASDAQ:MKTW) Will Be Trading Ex-Dividend

MarketWise, Inc. (NASDAQ:MKTW) is about to trade ex-dividend in the next three days. The ex-dividend date is one business day before the record date, which is the cut-off date for shareholders to be present on the company's books to be eligible for a dividend payment. The ex-dividend date is an important date to be aware of as any purchase of the stock made on or after this date might mean a late settlement that doesn't show on the record date. Therefore, if you purchase MarketWise's shares on or after the 1st of September, you won't be eligible to receive the dividend, when it is paid on the 26th of October.

The upcoming dividend for MarketWise is US$0.01 per share. If you buy this business for its dividend, you should have an idea of whether MarketWise's dividend is reliable and sustainable. As a result, readers should always check whether MarketWise has been able to grow its dividends, or if the dividend might be cut.

View our latest analysis for MarketWise

Dividends are usually paid out of company profits, so if a company pays out more than it earned then its dividend is usually at greater risk of being cut. MarketWise has a low and conservative payout ratio of just 16% of its income after tax.

Companies that pay out less in dividends than they earn in profits generally have more sustainable dividends. The lower the payout ratio, the more wiggle room the business has before it could be forced to cut the dividend.

Click here to see the company's payout ratio, plus analyst estimates of its future dividends.

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Have Earnings And Dividends Been Growing?

Companies with falling earnings are riskier for dividend shareholders. If earnings decline and the company is forced to cut its dividend, investors could watch the value of their investment go up in smoke. MarketWise's earnings have collapsed faster than Wile E Coyote's schemes to trap the Road Runner; down a tremendous 73% a year over the past five years.

This is MarketWise's first year of paying a dividend, which is exciting for shareholders - but it does mean there's no dividend history to examine.

Final Takeaway

Has MarketWise got what it takes to maintain its dividend payments? MarketWise's earnings per share are down over the past five years, although it has the cushion of a low payout ratio, which would suggest a cut to the dividend is relatively unlikely. We think there are likely better opportunities out there.

So if you want to do more digging on MarketWise, you'll find it worthwhile knowing the risks that this stock faces. We've identified 6 warning signs with MarketWise (at least 1 which is potentially serious), and understanding them should be part of your investment process.

Generally, we wouldn't recommend just buying the first dividend stock you see. Here's a curated list of interesting stocks that are 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.