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Anonymous
How do I know if a company will keep on paying dividends?
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Pang Zhe Liang
07 Dec 2019
Lead of Research & Solutions at Havend Pte Ltd
There is no way to confirm this. The best alternative is to make an intelligent guess based on the past track record.
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Look at historical DPU
Look at their CASH FLOW (Not earnings)
Look at their Debt
That being said, looking at these things still wont gaurantee they will keep paying dividends because there are things like black swans. Everything is all probability. So best to split your funds into a few, so if one stops giving, you are not affected too badly.βββ
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We dont know if the company will pay dividend forever. but we can estimate or predict.
few things to check:
consistent /growing dividend payment history
good cashflow
low/no debt.
dividend payment policy.
do note: if debt is pilling up, and cashflow is getting weaker, these are signs that the dividends might drop/stop or unsustainable...
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I don't think anyone can say for sure. But a good place to look for guidance is the annual report or...
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We wont know. All you can do is analyse the cashflow statement of a company's past years statement, then make an educated guess into the future if the cashflow generated by the company is capable of sustaining the payment of dividends