Detection technology Oyj (HEL:DETEC) stock is about to trade ex-dividend in 3 days. The ex-dividend date is one business day before the company's record date, which is the date on which the company determines which shareholders are entitled to receive the dividend. It is important to be aware of the ex-dividend date, as stock trades must be settled on or before the record date. This means that investors can purchase Detection Technology Oyj shares until March 28th in order to receive the dividend, which will be paid on April 9th.

The company's upcoming dividend is EUR 0.23 per share, continuing the last 12 months, when it distributed a total of EUR 0.23 per share to shareholders. Calculating the last year's worth of payments shows that Detection Technology Oyj has a yield of 1.8% on the current share price of €12.45. If you buy this business for its dividend, you want to understand whether Detection Technology Oyj's dividend is reliable and sustainable. That's why we should always check whether the dividend payments are sustainable, and if the company is growing.

Check out our latest analysis for Detection Technology Oyj.

Dividends are typically paid out of company profits, so if a company pays out more than it earned, its dividend is usually at a higher risk of being cut. Detection Technology Oyj paid out 61% of its profit to investors last year. This is the normal payout level for most businesses. That said, even highly profitable companies might not generate enough cash to pay the dividend, so we should always check if the dividend is covered by cash flow. Thankfully, the company's dividends account for just 39% of the free cash flow it generated, which is a comfortable payout ratio.

It's reassuring to see that the dividend is covered by both profit and cash flow. This generally suggests the dividend is sustainable, as long as earnings don't drop precipitously.

Click here to see the company's payout ratio and analyst estimates of its future dividends.

historic dividend
HLSE:DETEC Historical Dividend March 24, 2024

Are profits and dividends growing?

Companies whose profits are shrinking are difficult to view from a dividend perspective. Investors love dividends, so if earnings fall and the dividend is cut, you can expect the stock to sell off heavily at the same time. Detection Technology Oyj's earnings per share have decreased by approximately 18% per year over the last five years. After all, as earnings per share decline, the size of the pie that can pay dividends shrinks.

Another important way to measure a company's dividend prospects is by measuring its historical dividend growth rate. Detection Technology Oyj's dividends per share have declined at an average annual rate of 6.8% over the past six years, which is no surprise. It's not great that earnings per share and dividends have declined in recent years, but rather than risk over-committing to the company in order to maintain yields for shareholders, management should I'm encouraged by the fact that we've cut back on money.


Is Detection Technology Oyj an attractive dividend stock, or should you keep it on the shelf? At least the company's payout ratio is within a reasonable range, so it may not be at immediate risk of a cut. Yes, but we don't like the decline in earnings per share. In summary, it has some good features, but I wouldn't rush to buy Detection Technology Oyj today.

Curious what other investors think about Detection Technology Oyj? See what analysts are predicting by visualizing past and future estimated earnings and cash flow.

Generally speaking, we don't recommend just buying the first dividend stock you see.Here it is A curated list of interesting stocks with strong dividends.

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Please check it out Detection technology Oyj Could be overvalued or undervalued, check out our comprehensive analysis. Fair value estimates, risks and caveats, dividends, insider trading, and financial health.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts using only unbiased methodologies, and articles are not intended to be financial advice. This is not a recommendation to buy or sell any stock, and does not take into account your objectives or financial situation. We aim to provide long-term, focused analysis based on fundamental data. Note that our analysis may not factor in the latest announcements or qualitative material from price-sensitive companies. Simply Wall St has no position in any stocks mentioned.

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