Should You Buy Tata Consultancy Services Limited (NSE:TCS) For Its Upcoming Dividend?

Investors who rely on dividends to grow their wealth may be interested to know that Tata Consultancy Services Limited (NSE:TCS) is set to go ex-dividend in just 3 days. The ex-dividend date is important as it determines eligibility for a dividend payment. Investors who purchase Tata Consultancy Services’ shares on or after July 19th will not receive the dividend, which will be paid on August 5th.

The company’s next dividend payment will be ₹10.00 per share, with a total of ₹73.00 per share paid in the last 12 months. This gives Tata Consultancy Services a trailing yield of 1.7% on the current share price of ₹4183.95. It’s essential to assess whether the company can afford its dividend and if the dividend has the potential to grow.

Tata Consultancy Services paid out 43% of its profit and 86% of its free cash flow as dividends last year, indicating that the dividend is covered by both profit and cash flow. Earnings per share have been growing at a rate of 9.3% per annum over the last five years, but the company is paying out a majority of its earnings to shareholders, which may limit future growth.

The company has delivered 16% dividend growth per year on average over the past 10 years, indicating a commitment to rewarding shareholders. While Tata Consultancy Services looks okay based on this analysis, it may not be a standout opportunity for investors.

In conclusion, investors should carefully consider Tata Consultancy Services’ future prospects before investing in the upcoming dividend. It’s important to conduct thorough research and analysis to make informed investment decisions.