We wouldn’t be too quick to buy L’azurde Company for Jewelry (TADAWUL: 4011) before it goes ex-dividend

The azurde Company for Jewelery (TADAWUL:4011) is set to trade ex-dividend in the next three days. The ex-dividend date is one business day before a company’s record date, which is the date the company determines which shareholders are entitled to receive a dividend. The ex-dividend date is important because any trade in a share must have settled before the record date to be eligible for a dividend. In other words, investors can acquire the shares of L’azurde Company for Jewelry before June 1st in order to be eligible for the dividend which will be paid on January 1st.

The company’s next dividend payment will be ر.س.0.25 per share, and over the past 12 months the company has paid a total of ر.س.0.25 per share. Based on last year’s payouts, shares of L’azurde Company for Jewelry have a rolling yield of around 1.5% on the current share price of SAR 16.88. We love to see companies pay out a dividend, but it’s also important to make sure that laying the golden eggs doesn’t kill our golden hen! So we need to investigate whether L’azurde Company for Jewelry can afford its dividend, and whether the dividend could increase.

Discover our latest analyzes for L’azurde Company for Jewelry

Dividends are usually paid out of company profits, so if a company pays out more than it has earned, its dividend is usually at risk of being reduced. The Azurde Company for Jewelry paid out more than half (56%) of its profits last year, which is a regular payout ratio for most companies.

Click here to see how much profit The azurde Company for Jewelry has paid out in the last 12 months.

SASE:4011 Historic dividend May 28, 2022

Have earnings and dividends increased?

When earnings decline, dividend companies become much more difficult to analyze and to own safely. If earnings fall enough, the company could be forced to cut its dividend. L’azurde Company for Jewelry’s earnings per share have fallen about 23% per year for the past five years. When earnings per share decrease, the maximum amount of dividends that can be paid also decreases.

It should also be noted that L’azurde Company for Jewelry issued a large number of new shares during the past year. It is difficult to increase dividends per share when a company continues to create new shares.

Many investors will gauge a company’s dividend yield by evaluating how much dividend payouts have changed over time. The Azurde Company for Jewelry has seen its dividend drop by 13% per year on average over the past five years, which is not encouraging. It’s never nice to see earnings and dividends dip, but at least management cut the dividend rather than potentially risking the health of the business in an attempt to maintain it.

To sum up

Did the Azurde Company for Jewelry get what it needed to maintain its dividend payouts? We’re not too thrilled to see L’azurde Company for Jewelry’s profits slip back even as the company pays out more than half of its profits in the form of dividends to shareholders. It doesn’t sound like an exceptional opportunity, but it might be worth a closer look.

So, if you want to dig further on The Azure Company for Jewelry, you will find it useful to know the risks that this stock faces. For example, we found 4 warning signs for L’azurde Company for Jewelry (2 are a bit of a concern!) that deserve your attention before investing in stocks.

If you are looking for good dividend payers, we recommend by consulting our selection of the best dividend-paying stocks.

This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts only using unbiased methodology and our articles are not intended to be financial advice. It is not a recommendation to buy or sell stocks and does not take into account your objectives or financial situation. Our goal is to bring you targeted long-term analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price-sensitive companies or qualitative materials. Simply Wall St has no position in the stocks mentioned.

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