Yahoo Finance It Might Not Be A Great Idea To Buy Bridge Investment Group Holdings Inc. (NYSE:BRDG) For Its Next Dividend
Bridge Investment Group Holdings Inc. (NYSE:BRDG) stock is about to trade ex-dividend in 4 days. The ex-dividend date occurs one day before the record date which is the day on which shareholders need to be on the company's books in order to receive a dividend. The ex-dividend date is important as the process of settlement involves two full business days. So if you miss that date, you would not show up on the company's books on the record date. In other words, investors can purchase Bridge Investment Group Holdings' shares before the 31st of May in order to be eligible for the dividend, which will be paid on the 14th of June.
The company's next dividend payment will be US$0.12 per share, on the back of last year when the company paid a total of US$0.66 to shareholders. Based on the last year's worth of payments, Bridge Investment Group Holdings has a trailing yield of 8.4% on the current stock price of US$7.90. Dividends are an important source of income to many shareholders, but the health of the business is crucial to maintaining those dividends. So we need to investigate whether Bridge Investment Group Holdings can afford its dividend, and if the dividend could grow.
Check out our latest analysis for Bridge Investment Group Holdings
If a company pays out more in dividends than it earned, then the dividend might become unsustainable - hardly an ideal situation. Bridge Investment Group Holdings paid a dividend last year despite being unprofitable. This might be a one-off event, but it's not a sustainable state of affairs in the long run.
Click here to see the company's payout ratio, plus analyst estimates of its future dividends.
Have Earnings And Dividends Been Growing?
When earnings decline, dividend companies become much harder to analyse and own safely. If earnings decline and the company is forced to cut its dividend, investors could watch the value of their investment go up in smoke. Bridge Investment Group Holdings was unprofitable last year, and sadly its loss per share worsened by 131% on the previous year.
Another key way to measure a company's dividend prospects is by measuring its historical rate of dividend growth. Bridge Investment Group Holdings's dividend payments per share have declined at 12% per year on average over the past three years, which is uninspiring. It's never nice to see earnings and dividends falling, but at least management has cut the dividend rather than potentially risk the company's health in an attempt to maintain it.
Get our latest analysis on Bridge Investment Group Holdings's balance sheet health here.
To Sum It Up
Is Bridge Investment Group Holdings worth buying for its dividend? It's hard to get past the idea of Bridge Investment Group Holdings paying a dividend despite reporting a loss over the past year - especially when the general trend in its earnings also looks to be negative. These characteristics don't generally lead to outstanding dividend performance, and investors may not be happy with the results of owning this stock for its dividend.
Having said that, if you're looking at this stock without much concern for the dividend, you should still be familiar of the risks involved with Bridge Investment Group Holdings. In terms of investment risks, we've identified 3 warning signs with Bridge Investment Group Holdings 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.
