Yahoo Finance Only 2 Days Left Before Canadian Imperial Bank of Commerce (TSE:CM) Will Start Trading Ex-Dividend, Should Investors Buy?
Shares of Canadian Imperial Bank of Commerce (TSE:CM) will begin trading ex-dividend in 2 days. To qualify for the dividend check of CA$1.33 per share, investors must have owned the shares prior to 27 June 2018, which is the last day the company’s management will finalize their list of shareholders to which they will send dividend payments. Is this future income stream a compelling catalyst for dividend investors to think about the stock as an investment today? Let’s take a look at Canadian Imperial Bank of Commerce’s most recent financial data to examine its dividend characteristics in more detail. View out our latest analysis for Canadian Imperial Bank of Commerce
Here’s how I find good dividend stocks
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?
Has it paid dividend every year without dramatically reducing payout in the past?
Has dividend per share amount increased over the past?
Is its earnings sufficient to payout dividend at the current rate?
Based on future earnings growth, will it be able to continue to payout dividend at the current rate?
How does Canadian Imperial Bank of Commerce fare?
Canadian Imperial Bank of Commerce has a trailing twelve-month payout ratio of 46.95%, meaning the dividend is sufficiently covered by earnings. Going forward, analysts expect CM’s payout to remain around the same level at 45.70% of its earnings, which leads to a dividend yield of 4.75%. In addition to this, EPS should increase to CA$11.85.
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. In the case of CM it has increased its DPS from CA$3.48 to CA$5.32 in the past 10 years. It has also been paying out dividend consistently during this time, as you’d expect for a company increasing its dividend levels. This is an impressive feat, which makes CM a true dividend rockstar.
Relative to peers, Canadian Imperial Bank of Commerce produces a yield of 4.61%, which is high for Banks stocks but still below the market’s top dividend payers.
Next Steps:
Keeping in mind the dividend characteristics above, Canadian Imperial Bank of Commerce is definitely worth considering for investors looking to build a dedicated income portfolio. Given that this is purely a dividend analysis, I recommend taking sufficient time to understand its core business and determine whether the company and its investment properties suit your overall goals. Below, I’ve compiled three relevant factors you should further research:
Future Outlook: What are well-informed industry analysts predicting for CM’s future growth? Take a look at our free research report of analyst consensus for CM’s outlook.
Valuation: What is CM 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 CM is currently mispriced by the market.
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.
