Three Days Left To Buy Riyadh Cement Company (TADAWUL:3092) Before The Ex-Dividend Date

Simply Wall St · 04/16 03:06

Readers hoping to buy Riyadh Cement Company (TADAWUL:3092) for its dividend will need to make their move shortly, as the stock is about to trade ex-dividend. The ex-dividend date is two business days before a company's record date in most cases, which is the date on which the company determines which shareholders are entitled to receive a dividend. It is important to be aware of the ex-dividend date because any trade on the stock needs to have been settled on or before the record date. Therefore, if you purchase Riyadh Cement's shares on or after the 20th of April, you won't be eligible to receive the dividend, when it is paid on the 29th of April.

The company's next dividend payment will be ر.س1.25 per share, on the back of last year when the company paid a total of ر.س2.25 to shareholders. Calculating the last year's worth of payments shows that Riyadh Cement has a trailing yield of 6.4% on the current share price of ر.س35.00. Dividends are an important source of income to many shareholders, but the health of the business is crucial to maintaining those dividends. That's why we should always check whether the dividend payments appear sustainable, and if the company is growing.

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Dividends are usually paid out of company profits, so if a company pays out more than it earned then its dividend is usually at greater risk of being cut. Its dividend payout ratio is 87% of profit, which means the company is paying out a majority of its earnings. The relatively limited profit reinvestment could slow the rate of future earnings growth. It could become a concern if earnings started to decline. Yet cash flows are even more important than profits for assessing a dividend, so we need to see if the company generated enough cash to pay its distribution. It paid out more than half (62%) of its free cash flow in the past year, which is within an average range for most companies.

It's encouraging 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.

View our latest analysis for Riyadh Cement

Click here to see how much of its profit Riyadh Cement paid out over the last 12 months.

historic-dividend
SASE:3092 Historic Dividend April 16th 2025

Have Earnings And Dividends Been Growing?

Companies with consistently growing earnings per share generally make the best dividend stocks, as they usually find it easier to grow dividends per share. If earnings decline and the company is forced to cut its dividend, investors could watch the value of their investment go up in smoke. For this reason, we're glad to see Riyadh Cement's earnings per share have risen 10% per annum over the last five years. The company paid out most of its earnings as dividends over the last year, even though business is booming and earnings per share are growing rapidly. Higher earnings generally bode well for growing dividends, although with seemingly strong growth prospects we'd wonder why management are not reinvesting more in the business.

Many investors will assess a company's dividend performance by evaluating how much the dividend payments have changed over time. Riyadh Cement has delivered an average of 6.5% per year annual increase in its dividend, based on the past four years of dividend payments. We're glad to see dividends rising alongside earnings over a number of years, which may be a sign the company intends to share the growth with shareholders.

To Sum It Up

Is Riyadh Cement an attractive dividend stock, or better left on the shelf? Higher earnings per share generally lead to higher dividends from dividend-paying stocks over the long run. That's why we're glad to see Riyadh Cement's earnings per share growing, although as we saw, the company is paying out more than half of its earnings and cashflow - 87% and 62% respectively. In summary, while it has some positive characteristics, we're not inclined to race out and buy Riyadh Cement today.

So while Riyadh Cement looks good from a dividend perspective, it's always worthwhile being up to date with the risks involved in this stock. Our analysis shows 1 warning sign for Riyadh Cement and you should be aware of it before buying any shares.

Generally, we wouldn't recommend just buying the first dividend stock you see. Here's a curated list of interesting stocks that are strong dividend payers.