FSE Lifestyle Services Limited (HKG:331) has announced that its investors will receive a dividend payment of HK$0.214 per share on December 16th, yielding 7.6%, which is above the industry average. The company’s latest analysis reveals that the dividend is sustainable, supported by solid earnings coverage. FSE Lifestyle Services’ earnings per share (EPS) is forecasted to expand by 26.1% over the next year, with a payout ratio expected to be 37% by next year, indicating sustainability.
However, FSE Lifestyle Services’ dividend history has been inconsistent, with fluctuations over the past nine years. While dividends have grown rapidly, past cuts raise concerns about future reliability. Nonetheless, the company has seen EPS rise by 9.9% annually for the past five years, offsetting some of the concerns about dividend fluctuations.
Despite some caution regarding cash flows, investors see FSE Lifestyle Services as a great dividend stock, supported by increasing dividends and overall sustainability. The company’s ability to cover distributions and generate cash is a positive sign for income-seeking investors. While a consistent dividend policy is preferred, other factors should also be considered when analyzing a company.
Investors interested in high-yielding dividend stocks may also explore other opportunities, such as dividend powerhouses, undervalued small caps with insider buying, or high-growth tech and AI companies. Ultimately, investors should conduct thorough research and consider various factors before investing in any stock.
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