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Be Sure To Check Out Hikari Tsushin, Inc. (TSE:9435) Before It Goes Ex-Dividend

Simply Wall St · 1d ago

Hikari Tsushin, Inc. (TSE:9435) is about to trade ex-dividend in the next four days. The ex-dividend date is usually set to be two business days before the record date, which is the cut-off date on which you must be present on the company's books as a shareholder in order to receive the dividend. The ex-dividend date is of consequence because whenever a stock is bought or sold, the trade can take two business days or more to settle. Meaning, you will need to purchase Hikari Tsushin's shares before the 29th of December to receive the dividend, which will be paid on the 16th of March.

The company's upcoming dividend is JP¥185.00 a share, following on from the last 12 months, when the company distributed a total of JP¥740 per share to shareholders. Based on the last year's worth of payments, Hikari Tsushin has a trailing yield of 1.7% on the current stock price of JP¥44010.00. Dividends are a major contributor to investment returns for long term holders, but only if the dividend continues to be paid. So we need to investigate whether Hikari Tsushin can afford its dividend, and if the dividend could grow.

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If a company pays out more in dividends than it earned, then the dividend might become unsustainable - hardly an ideal situation. Hikari Tsushin has a low and conservative payout ratio of just 22% of its income after tax. 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 (51%) of its free cash flow in the past year, which is within an average range for most companies.

It's positive to see that Hikari Tsushin's dividend is covered by both profits and cash flow, since this is generally a sign that the dividend is sustainable, and a lower payout ratio usually suggests a greater margin of safety before the dividend gets cut.

View our latest analysis for Hikari Tsushin

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

historic-dividend
TSE:9435 Historic Dividend December 24th 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. Investors love dividends, so if earnings fall and the dividend is reduced, expect a stock to be sold off heavily at the same time. It's encouraging to see Hikari Tsushin has grown its earnings rapidly, up 23% a year for the past five years.

Another key way to measure a company's dividend prospects is by measuring its historical rate of dividend growth. Since the start of our data, 10 years ago, Hikari Tsushin has lifted its dividend by approximately 17% a year on average. Both per-share earnings and dividends have both been growing rapidly in recent times, which is great to see.

Final Takeaway

Has Hikari Tsushin got what it takes to maintain its dividend payments? Earnings per share have grown at a nice rate in recent times and over the last year, Hikari Tsushin paid out less than half its earnings and a bit over half its free cash flow. Hikari Tsushin looks solid on this analysis overall, and we'd definitely consider investigating it more closely.

On that note, you'll want to research what risks Hikari Tsushin is facing. In terms of investment risks, we've identified 1 warning sign with Hikari Tsushin and understanding them should be part of your investment process.

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.