The Ramsay Health Care Limited Fully Paid Ord. Shrs (ASX: RHC) share price fell 1.32% on the ASX today to close at $63.03.
If you've been thinking of buying shares in the global hospital group for its growing, fully franked divided, there are a few things you need to know today.
The first is that shares will go ex-dividend on Wednesday, March 6, 2019. The 'ex-date' is when the shares start selling without the value of its next dividend payment so an investor needs to own the shares before the ex-date to receive the dividend. The dividend will then be paid on Friday, March 29, 2019.
What is Ramsay Health Care's dividend yield?
At its recent half-year results, Ramsay declared a dividend of 60 cents per share for the half year. This was up 4.3% on the same period in 2018 and at the current share price of $63 per share the company offers a trailing dividend yield of 2.3%, fully franked.
Is the dividend sustainable going forward?
This is a great question to ask before buying any company for its dividend.
At the company's half-year update last week Ramsay presented Net profit after tax (NPAT) of $274 million for the six months to 31 December 2018, up 1.1% on the same period in 2017.
Pleasingly revenue lifted 16% and cash flows from operations lifted 6.5% which is a positive sign for sustaining dividends.
Ramsay has a strong history of earnings and dividend growth and looking forward the group is expecting to achieve its guidance of 'Core' earnings per share (EPS) growth of up to 2% for the full financial year.
Foolish takeaway
I think Ramsay Health Care will be a clear beneficiary of the long-term trend of increasing healthcare expenditure and although its current yield of 2.3% is not earth-shattering, the long-term prospects for increasing distributions to investors would be worth short-listing to my dividend watch-list.
However, there are also several other companies going ex-dividend on 06 March to consider, including:
