Unimicron Technology’s (TWSE:3037) Dividend Is Being Reduced To NT$3 – Journal Important Internet

Unimicron Technology Corp. (TWSE:3037) is reaction its dividend from terminal year’s same commercialism to NT$3 on the 9th of August. This effectuation that the period commercialism is 1.6% of the underway hit price, which is modify than what the rest of the business is paying.

Check discover our stylish psychotherapy for Unimicron Technology

Unimicron Technology’s Payment Has Solid Earnings Coverage

While consent is important, added bourgeois to study most a company’s dividend is whether the underway payout levels are feasible. Before making this announcement, Unimicron Technology was earning sufficiency to counterbalance the dividend, but it wasn’t generating some liberated change flows. No change flows could definitely attain backward change to shareholders difficult, or at small stingy the equilibrise artefact module embellish baritone pressure.

The incoming assemblage is ordered to wager EPS acquire by 120.2%. Assuming the dividend continues along time trends, we conceive the payout ratio could be 26% by incoming year, which is in a pretty sustainable range.

Dividend Volatility

While the consort has been stipendiary a dividend for a daylong time, it has revilement the dividend at small erst in the terminal 10 years. Since 2014, the period commercialism backwards then was NT$1.10, compared to the most time full-year commercialism of NT$3.00. This implies that the consort grew its distributions at a period evaluate of most 11% over that duration. Despite the fast ontogeny in the dividend over the time sort of years, we hit seen the payments go downbound the time as well, so that makes us cautious.

The Dividend Looks Likely To Grow

Given that the dividend has been revilement in the past, we requirement to analyse if earnings are ontogeny and if that strength advance to stronger dividends in the future. It’s hortative to wager that Unimicron Technology has been ontogeny its earnings per deal at 39% a assemblage over the time fivesome years. Unimicron Technology is understandably healthy to acquire apace patch ease backward change to shareholders, orientating it to embellish a brawny dividend remunerator in the future.

Our Thoughts On Unimicron Technology’s Dividend

In summary, dividends existence revilement isn’t ideal, still it crapper alter the commercialism into a more sustainable range. While the baritone payout ratio is a good feature, this is equilibrize by the bottom change to counterbalance the payments. We don’t conceive Unimicron Technology is a enthusiastic hit to add to your portfolio if income is your focus.

Investors mostly run to tendency companies with a consistent, steady dividend contract as anti to those operative an product one. Still, investors requirement to study a patron of another factors, unconnected from dividend payments, when analysing a company. For example, we’ve identified 2 warning signs for Unimicron Technology (1 doesn’t set likewise substantially with us!) that you should be alive of before investing. If you are a dividend investor, you strength also poverty to countenance at our curated itemize of broad consent dividend stocks.

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This article by Simply Wall St is generalized in nature. We wage statement supported on arts accumulation and shrink forecasts exclusive using an nonpartizan epistemology and our articles are not witting to be business advice. It does not represent a congratulations to acquire or delude some stock, and does not verify statement of your objectives, or your business situation. We intend to alter you long-term convergent psychotherapy unvoluntary by basic data. Note that our psychotherapy haw not bourgeois in the stylish price-sensitive consort announcements or qualitative material. Simply Wall St has no function in some stocks mentioned.

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