The board of Hokkaido Electric Power Company, Incorporated (TSE:9509) has announced that it will pay a dividend on the 29th of June, with investors receiving ¥15.00 per share. This makes the dividend yield about the same as the industry average at 2.8%.
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Hokkaido Electric Power Company’s Future Dividend Projections Appear Well Covered By Earnings
Unless the payments are sustainable, the dividend yield doesn’t mean too much. Based on the last payment, Hokkaido Electric Power Company was earning enough to cover the dividend, but free cash flows weren’t positive. With the company not bringing in any cash, paying out to shareholders is bound to become difficult at some point.
Over the next year, EPS is forecast to expand by 0.8%. If the dividend continues along recent trends, we estimate the payout ratio will be 12%, which is in the range that makes us comfortable with the sustainability of the dividend.
TSE:9509 Historic Dividend December 26th 2025
View our latest analysis for Hokkaido Electric Power Company
Dividend Volatility
The company’s dividend history has been marked by instability, with at least one cut in the last 10 years. The annual payment during the last 10 years was ¥5.00 in 2015, and the most recent fiscal year payment was ¥30.00. This means that it has been growing its distributions at 20% per annum over that time. Despite the rapid growth in the dividend over the past number of years, we have seen the payments go down the past as well, so that makes us cautious.
We Could See Hokkaido Electric Power Company’s Dividend Growing
Growing earnings per share could be a mitigating factor when considering the past fluctuations in the dividend. We are encouraged to see that Hokkaido Electric Power Company has grown earnings per share at 6.5% per year over the past five years. A low payout ratio and decent growth suggests that the company is reinvesting well, and it also has plenty of room to increase the dividend over time.
In Summary
Overall, we always like to see the dividend being raised, but we don’t think Hokkaido Electric Power Company will make a great income stock. While Hokkaido Electric Power Company is earning enough to cover the payments, the cash flows are lacking. Overall, we don’t think this company has the makings of a good income stock.
It’s important to note that companies having a consistent dividend policy will generate greater investor confidence than those having an erratic one. Still, investors need to consider a host of other factors, apart from dividend payments, when analysing a company. For example, we’ve identified 3 warning signs for Hokkaido Electric Power Company (1 is significant!) that you should be aware of before investing. If you are a dividend investor, you might also want to look at our curated list of high yield 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.
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