Yahoo Finance Only Four Days Left To Cash In On Matrix Concepts Holdings Berhad's (KLSE:MATRIX) Dividend
Some investors rely on dividends for growing their wealth, and if you're one of those dividend sleuths, you might be intrigued to know that Matrix Concepts Holdings Berhad (KLSE:MATRIX) is about to go ex-dividend in just 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 of consequence because whenever a stock is bought or sold, the trade takes at least two business day to settle. In other words, investors can purchase Matrix Concepts Holdings Berhad's shares before the 20th of September in order to be eligible for the dividend, which will be paid on the 5th of October.
The company's next dividend payment will be RM0.025 per share, and in the last 12 months, the company paid a total of RM0.083 per share. Calculating the last year's worth of payments shows that Matrix Concepts Holdings Berhad has a trailing yield of 5.6% on the current share price of MYR1.48. Dividends are a major contributor to investment returns for long term holders, but only if the dividend continues to be paid. As a result, readers should always check whether Matrix Concepts Holdings Berhad has been able to grow its dividends, or if the dividend might be cut.
See our latest analysis for Matrix Concepts Holdings Berhad
Dividends are typically paid out of company income, so if a company pays out more than it earned, its dividend is usually at a higher risk of being cut. That's why it's good to see Matrix Concepts Holdings Berhad paying out a modest 41% of its earnings. Yet cash flow is typically more important than profit for assessing dividend sustainability, so we should always check if the company generated enough cash to afford its dividend. It distributed 39% of its free cash flow as dividends, a comfortable payout level for most companies.
It's positive to see that Matrix Concepts Holdings Berhad's dividend is covered by both profits and cash flow, since this is generally a sign that the dividend is sustainable, and a lower payout ratio usually suggests a greater margin of safety before the dividend gets cut.
Click here to see the company's payout ratio, plus analyst estimates of its future dividends.
Have Earnings And Dividends Been Growing?
Companies that aren't growing their earnings can still be valuable, but it is even more important to assess the sustainability of the dividend if it looks like the company will struggle to grow. If business enters a downturn and the dividend is cut, the company could see its value fall precipitously. That explains why we're not overly excited about Matrix Concepts Holdings Berhad's flat earnings over the past five years. We'd take that over an earnings decline any day, but in the long run, the best dividend stocks all grow their earnings per share.
Another key way to measure a company's dividend prospects is by measuring its historical rate of dividend growth. Matrix Concepts Holdings Berhad's dividend payments are broadly unchanged compared to where they were 10 years ago.
Final Takeaway
From a dividend perspective, should investors buy or avoid Matrix Concepts Holdings Berhad? Earnings per share have been flat, although at least the company is paying out a low and conservative percentage of both its earnings and cash flow. It's definitely not great to see earnings falling, but at least there may be some buffer before the dividend gets cut. While it does have some good things going for it, we're a bit ambivalent and it would take more to convince us of Matrix Concepts Holdings Berhad's dividend merits.
While it's tempting to invest in Matrix Concepts Holdings Berhad for the dividends alone, you should always be mindful of the risks involved. For example - Matrix Concepts Holdings Berhad has 1 warning sign we think you should be aware of.
If you're in the market for strong dividend payers, we recommend checking our selection of top dividend stocks.
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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.
