Paramount Resources (OTC:PRMRF) Ltd. (TSE:POU) has announced November 14 as the ex-dividend date for its upcoming dividend. Investors need to acquire shares before this day to qualify for the dividend, which is scheduled to be paid on November 30 at CA$0.13 per share. The company's shares are approaching the ex-dividend date, which is set one business day before the record date, a key time frame for investors since purchases made after this date won't qualify for the imminent dividend.
The forthcoming dividend represents a decrease from last year's total payout of CA$1.50 per share, resulting in a trailing yield of 5.3% based on the current share price of CA$28.35. Despite the reduction in the upcoming dividend amount compared to last year's total payout, Paramount Resources maintains a modest payout ratio of 34% of its earnings and 80% of free cash flow, indicating a sustainable dividend with a safety margin that could prevent potential cuts.
Over the past five years, Paramount Resources' earnings per share have grown by an average of 7.9%, strengthening its dividend-paying capacity. In the two years leading up to the record date, the company has increased its dividend by approximately 150% annually, demonstrating corporate commitment to rewarding shareholders amidst growing earnings.
The decrease in the upcoming dividend amount and the significance of the payout ratio as an indicator of sustainability underscore the importance of dividend eligibility for investors. This highlights dividends' role in long-term investment returns.
InvestingPro Insights
Delving into the real-time data from InvestingPro, Paramount Resources Ltd. (TSE:POU) holds a strong financial position. The company holds more cash than debt on its balance sheet, a significant indicator of financial health and stability. This aligns with the InvestingPro Tip that companies with more cash than debt are generally in a better position to meet their financial obligations, potentially offering a safer investment.
The company's earnings per share have been on an upward trajectory, consistently increasing over the years. This is a positive sign for investors as it implies a strong and growing profitability. Importantly, this aligns with the InvestingPro Tip that a steady rise in earnings per share is a promising sign for investors.
Lastly, Paramount Resources has raised its dividend for three consecutive years. This is an encouraging sign for income-focused investors, showing the company's commitment to returning capital to its shareholders. This aligns with the InvestingPro Tip that companies raising their dividends consistently are often a good investment, especially for those seeking income in addition to capital growth.
In conclusion, Paramount Resources presents a compelling investment opportunity, backed by strong financial data and aligning with key InvestingPro Tips. For further insights and tips, consider exploring the InvestingPro platform, which offers an extensive list of over 10 additional tips for Paramount Resources and other companies.
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