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Ryman Healthcare Limited (NZSE:RYM): Ex-Dividend Is In 4 Days

On the 14 December 2018, Ryman Healthcare Limited (NZSE:RYM) will be paying shareholders an upcoming dividend amount of NZ$0.11 per share. However, investors must have bought the company’s stock before 06 December 2018 in order to qualify for the payment. That means you have only 4 days left! Investors looking for higher income-generating stocks to add to their portfolio should keep reading, as I take a deeper dive into Ryman Healthcare’s latest financial data to analyse its dividend attributes.

View our latest analysis for Ryman Healthcare

Here’s how I find good dividend stocks

Whenever I am looking at a potential dividend stock investment, I always check these five metrics:

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  • Does it pay an annual yield higher than 75% of dividend payers?

  • Has it paid dividend every year without dramatically reducing payout in the past?

  • Has dividend per share amount increased over the past?

  • Does earnings amply cover its dividend payments?

  • Will it be able to continue to payout at the current rate in the future?

NZSE:RYM Historical Dividend Yield December 1st 18
NZSE:RYM Historical Dividend Yield December 1st 18

How does Ryman Healthcare fare?

Ryman Healthcare has a trailing twelve-month payout ratio of 31%, meaning the dividend is sufficiently covered by earnings. Going forward, analysts expect RYM’s payout to increase to 50% of its earnings, which leads to a dividend yield of around 2.5%. However, EPS is forecasted to fall to NZ$0.62 in the upcoming year. Therefore, although payout is expected to increase, the fall in earnings may not equate to higher dividend income.

When considering the sustainability of dividends, it is also worth checking the cash flow of a company. Companies with strong cash flow can sustain a higher payout ratio, while companies with weaker cash flow generally cannot.

If there is one thing that you want to be reliable in your life, it’s dividend stocks and their constant income stream. In the case of RYM it has increased its DPS from NZ$0.052 to NZ$0.22 in the past 10 years. During this period it has not missed a payment, as one would expect for a company increasing its dividend. This is an impressive feat, which makes RYM a true dividend rockstar.

In terms of its peers, Ryman Healthcare generates a yield of 1.9%, which is on the low-side for Healthcare stocks.

Next Steps:

With this in mind, I definitely rank Ryman Healthcare as a strong dividend stock, and makes it worth further research for anyone who likes steady income generation from their 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 aspects you should look at:

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

  2. Valuation: What is RYM 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 RYM is currently mispriced by the market.

  3. 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 past 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. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.