CNOOC Limited’s (HKG:883) investors are set to receive a payment of CN¥0.66 per share on July 12th, resulting in a dividend yield of 5.9%, which is lower than the industry average.
CNOOC’s earnings easily cover the distributions, indicating that the company is comfortably earning enough to sustain the dividend payment. The forecasted EPS for the next year is expected to decrease by 2.0%, with a projected payout ratio of 51%, leaving plenty of earnings for future business growth.
Despite a history of dividend cuts over the past 10 years, CNOOC has seen growth in its dividend payments, growing at a rate of about 10% annually. With a solid EPS growth rate of 18% per year over the past five years, the company appears well-positioned to continue growing earnings and dividends in the future.
While maintaining a stable dividend policy is crucial for investor confidence, CNOOC’s potential as a solid income stock looks promising. By potentially reducing dividend payouts to protect the balance sheet, the company aims to ensure sustainable dividends for the long term.
Investors should consider various factors when analyzing stock performance, including potential warning signs and high-yielding dividend opportunities. Keeping a close eye on valuation and financial health can help determine if a stock like CNOOC is undervalued or overvalued.
This article by Simply Wall St provides unbiased commentary based on historical data and analyst forecasts. It is not financial advice and does not recommend buying or selling any stock without considering individual objectives and financial situations. Simply Wall St aims to offer long-term focused analysis driven by fundamental data, with no position in any mentioned stocks.