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Why You Might Be Interested In Round One Corporation (TSE:4680) For Its Upcoming Dividend

Simply Wall St · 1d ago

Round One Corporation (TSE:4680) stock is about to trade ex-dividend in four days. Typically, the ex-dividend date is two business days before the record date, which is the date on which a company determines the shareholders eligible to receive a dividend. The ex-dividend date is important because any transaction on a stock needs to have been settled before the record date in order to be eligible for a dividend. Meaning, you will need to purchase Round One's shares before the 29th of December to receive the dividend, which will be paid on the 6th of March.

The company's next dividend payment will be JP¥4.50 per share. Last year, in total, the company distributed JP¥18.00 to shareholders. Based on the last year's worth of payments, Round One has a trailing yield of 1.6% on the current stock price of JP¥1119.50. If you buy this business for its dividend, you should have an idea of whether Round One's dividend is reliable and sustainable. So we need to investigate whether Round One can afford its dividend, and if the dividend could grow.

We've found 21 US stocks that are forecast to pay a dividend yield of over 6% next year. See the full list for free.

Dividends are typically paid out of company income, so if a company pays out more than it earned, its dividend is usually at a higher risk of being cut. That's why it's good to see Round One paying out a modest 29% of its earnings. 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. Luckily it paid out just 9.2% of its free cash flow last year.

It's positive to see that Round One'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 Round One

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

historic-dividend
TSE:4680 Historic Dividend December 24th 2025

Have Earnings And Dividends Been Growing?

Businesses with strong growth prospects usually make the best dividend payers, because it's easier to grow dividends when earnings per share are improving. If earnings decline and the company is forced to cut its dividend, investors could watch the value of their investment go up in smoke. That's why it's comforting to see Round One's earnings have been skyrocketing, up 29% per annum for the past five years. Round One is paying out less than half its earnings and cash flow, while simultaneously growing earnings per share at a rapid clip. This is a very favourable combination that can often lead to the dividend multiplying over the long term, if earnings grow and the company pays out a higher percentage of its earnings.

The main way most investors will assess a company's dividend prospects is by checking the historical rate of dividend growth. In the past 10 years, Round One has increased its dividend at approximately 10% a year on average. It's exciting to see that both earnings and dividends per share have grown rapidly over the past few years.

Final Takeaway

Is Round One an attractive dividend stock, or better left on the shelf? We love that Round One is growing earnings per share while simultaneously paying out a low percentage of both its earnings and cash flow. These characteristics suggest the company is reinvesting in growing its business, while the conservative payout ratio also implies a reduced risk of the dividend being cut in the future. Overall we think this is an attractive combination and worthy of further research.

In light of that, while Round One has an appealing dividend, it's worth knowing the risks involved with this stock. For example, we've found 1 warning sign for Round One that we recommend you consider before investing in the business.

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.