Earlier this week Australia's largest ASX-listed childcare centre owner and operator, G8 Education Ltd (ASX: GEM), reported a 70% increase in annual net profit.
However, surprisingly, its share price has actually fallen 5% since the announcement – talk about high expectations!
If a 70% increase in profit isn't good enough for the market, I'd love to know what is.
Not only is G8 Education rapidly growing its centre count, but it is also paying a rising quarterly dividend stream. Its most recent payout was six cents per share fully franked.
Even if it doesn't increase its payout and simply continues to distribute the same amount over the next three quarters, its shares would boast a yield equivalent to 5.5% fully franked, or a whopping 7.9% grossed-up!
For a growth stock like G8 Education that's a very impressive dividend yield.
Perhaps that's why G8 Education's Chairman Jennifer Hutson and non-executive director Andrew Kemp bought a combined $947,429 worth of their own company's shares over just the past two days.
There's a saying in the finance industry, "Directors sell their own company's shares for many reasons, but they buy for just one."
Could this be a better dividend stock idea than G8 Education?
