09-04-2025
Tecan Group AG (VTX:TECN) Goes Ex-Dividend Soon
Tecan Group AG (VTX:TECN) is about to trade ex-dividend in the next four days. Typically, the ex-dividend date is two business days before the record date, which is the date on which a company determines the shareholders eligible to receive a dividend. The ex-dividend date is important as the process of settlement involves at least two full business days. So if you miss that date, you would not show up on the company's books on the record date. Accordingly, Tecan Group investors that purchase the stock on or after the 14th of April will not receive the dividend, which will be paid on the 16th of April.
The company's next dividend payment will be CHF03.00 per share, on the back of last year when the company paid a total of CHF3.00 to shareholders. Based on the last year's worth of payments, Tecan Group stock has a trailing yield of around 2.1% on the current share price of CHF0145.80. We love seeing companies pay a dividend, but it's also important to be sure that laying the golden eggs isn't going to kill our golden goose! So we need to check whether the dividend payments are covered, and if earnings are growing.
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If a company pays out more in dividends than it earned, then the dividend might become unsustainable - hardly an ideal situation. Tecan Group paid out more than half (57%) of its earnings last year, which is a regular payout ratio for most companies. Yet cash flows are even more important than profits for assessing a dividend, so we need to see if the company generated enough cash to pay its distribution. Fortunately, it paid out only 33% of its free cash flow in the past year.
It's positive to see that Tecan Group's dividend is covered by both profits and cash flow, since this is generally a sign that the dividend is sustainable, and a lower payout ratio usually suggests a greater margin of safety before the dividend gets cut.
Check out our latest analysis for Tecan Group
Click here to see the company's payout ratio, plus analyst estimates of its future dividends.
Businesses with shrinking earnings are tricky from a dividend perspective. If earnings fall far enough, the company could be forced to cut its dividend. That's why it's not ideal to see Tecan Group's earnings per share have been shrinking at 3.0% a year over the previous five years.
The main way most investors will assess a company's dividend prospects is by checking the historical rate of dividend growth. Tecan Group has delivered 7.2% dividend growth per year on average over the past 10 years. Growing the dividend payout ratio while earnings are declining can deliver nice returns for a while, but it's always worth checking for when the company can't increase the payout ratio any more - because then the music stops.
From a dividend perspective, should investors buy or avoid Tecan Group? The payout ratios are within a reasonable range, implying the dividend may be sustainable. Declining earnings are a serious concern, however, and could pose a threat to the dividend in future. In summary, it's hard to get excited about Tecan Group from a dividend perspective.
If you want to look further into Tecan Group, it's worth knowing the risks this business faces. Every company has risks, and we've spotted 1 warning sign for Tecan Group you should know about.
If you're in the market for strong dividend payers, we recommend checking our selection of top dividend stocks.
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