Tenaris SA (BIT:TEN) Will Pay US$0.13 In Dividends

If you are interested in cashing in on Tenaris SA’s (BIT:TEN) upcoming dividend of US$0.13 per share, you only have 4 days left to buy the shares before its ex-dividend date, 19 November 2018, in time for dividends payable on the 21 November 2018. Is this future income a persuasive enough catalyst for investors to think about Tenaris as an investment today? Below, I’m going to look at the latest data and analyze the stock and its dividend property in further detail.

See our latest analysis for Tenaris

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 the amount of dividend per share grown over the past?

• Is is able to pay the current rate of dividends from its earnings?

• Based on future earnings growth, will it be able to continue to payout dividend at the current rate?

BIT:TEN Historical Dividend Yield November 14th 18

How well does Tenaris fit our criteria?

The current trailing twelve-month payout ratio for the stock is 60%, which means that the dividend is covered by earnings. In the near future, analysts are predicting lower payout ratio of 42%, leading to a dividend yield of 3.3%. However, EPS should increase to $0.86, meaning that the lower payout ratio does not necessarily implicate a lower dividend payment.

When assessing the forecast sustainability of a dividend it is also worth considering the cash flow of the business. Cash flow is important because companies with strong cash flow can usually sustain higher payout ratios.

If there’s one type of stock you want to be reliable, it’s dividend stocks and their stable income-generating ability. Whilst its per-share payments have increased during the past 10 years, there has been some hiccups. Shareholders would have seen a few years of reduced payments in this time.

Relative to peers, Tenaris has a yield of 2.9%, which is on the low-side for Energy Services stocks.

Next Steps:

Keeping in mind the dividend characteristics above, Tenaris is definitely worth considering for investors looking to build a dedicated income portfolio. Given that this is purely a dividend analysis, I urge potential investors to try and get a good understanding of the underlying business and its fundamentals before deciding on an investment. Below, I’ve compiled three fundamental factors you should look at:

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

2. Valuation: What is TEN 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 TEN 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.