Tiptree Inc.( NASDAQ:TIPT ) stock is about to trade ex-dividend in 4 days. The ex-dividend date is usually set to be one business day 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 important as the process of settlement involves a full business day. So if you miss that date, you would not show up on the company's books on the record date. Thus, you can purchase Tiptree's shares before the 18th of May in order to receive the dividend, which the company will pay on the 26th of May.
The company's next dividend payment will be US$0.06 per share, and in the last 12 months, the company paid a total of US$0.24 per share. Based on the last year's worth of payments, Tiptree has a trailing yield of 1.4% on the current stock price of US$16.96. If you buy this business for its dividend, you should have an idea of whether Tiptree's dividend is reliable and sustainable. That's why we should always check whether the dividend payments appear sustainable, and if the company is growing.
Dividends are typically paid from company earnings. If a company pays more in dividends than it earned in profit, then the dividend could be unsustainable. Tiptree reported a loss last year, so it's not great to see that it has continued paying a dividend.
View our latest analysis for Tiptree
Click here to see how much of its profit Tiptree paid out over the last 12 months.
Have Earnings And Dividends Been Growing?
Businesses with shrinking earnings are tricky from a dividend perspective. If earnings fall far enough, the company could be forced to cut its dividend. Tiptree was unprofitable last year and, unfortunately, the general trend suggests its earnings have been in decline over the last five years, making us wonder if the dividend is sustainable at all.
Another key way to measure a company's dividend prospects is by measuring its historical rate of dividend growth. In the past 10 years, Tiptree has increased its dividend at approximately 9.1% a year on average.
We update our analysis on Tiptree every 24 hours, so you can always get the latest insights on its financial health, here.
The Bottom Line
Is Tiptree an attractive dividend stock, or better left on the shelf? It's hard to get past the idea of Tiptree paying a dividend despite reporting a loss over the past year - especially when the general trend in its earnings also looks to be negative. All things considered, we're not optimistic about its dividend prospects, and would be inclined to leave it on the shelf for now.
Although, if you're still interested in Tiptree and want to know more, you'll find it very useful to know what risks this stock faces. Our analysis shows 2 warning signs for Tiptree and you should be aware of them before buying any shares.
If you're in the market for strong dividend payers, we recommend checking our selection of top dividend stocks.
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This article by Simply Wall St is general in nature.
We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice.
It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
