Janus Henderson Group plc (NYSE:JHG) is about to trade ex-dividend in the next three days.  The ex-dividend date is usually set to be one business day before the record date which is the cut-off date on which you must be present on the company's books as a shareholder in order to receive the dividend.  The ex-dividend date is important as the process of settlement involves 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, Janus Henderson Group investors that purchase the stock on or after the 10th of May will not receive the dividend, which will be paid on the 29th of May.  

The company's next dividend payment will be US$0.39 per share, on the back of last year when the company paid a total of US$1.56 to shareholders.  Calculating the last year's worth of payments shows that Janus Henderson Group has a trailing yield of 4.8% on the current share price of US$32.55.    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!  That's why we should always check whether the dividend payments appear sustainable, and if the company is growing.

Dividends are typically paid out of company income, so if a company pays out more than it earned, its dividend is usually at a higher risk of being cut.   Janus Henderson Group paid out 59% of its earnings to investors last year, a normal payout level for most businesses.  

Companies that pay out less in dividends than they earn in profits generally have more sustainable dividends. The lower the payout ratio, the more wiggle room the business has before it could be forced to cut the dividend.

Click here to see the company's payout ratio, plus analyst estimates of its future dividends.

NYSE:JHG Historic Dividend May 6th 2024

Have Earnings And Dividends Been Growing?

Companies that aren't growing their earnings can still be valuable, but it is even more important to assess the sustainability of the dividend if it looks like the company will struggle to grow.   If business enters a downturn and the dividend is cut, the company could see its value fall precipitously.     With that in mind, we're not enthused to see that Janus Henderson Group's earnings per share have remained effectively flat over the past five years.  It's better than seeing them drop, certainly, but over the long term, all of the best dividend stocks are able to meaningfully grow their earnings per share.    

Many investors will assess a company's dividend performance by evaluating how much the dividend payments have changed over time.     Since the start of our data, seven years ago, Janus Henderson Group has lifted its dividend by approximately 2.9% a year on average.    

The Bottom Line

Is Janus Henderson Group worth buying for its dividend?      Janus Henderson Group's earnings are effectively flat over recent years, even as the company pays out more than half of its earnings to shareholders as dividends.        It doesn't appear an outstanding opportunity, but could be worth a closer look.  

With that being said, if dividends aren't your biggest concern with Janus Henderson Group, you should know about the other risks facing this business.     For instance, we've identified 3 warning signs for Janus Henderson Group (1 is concerning) you should be aware of.  

Generally, we wouldn't recommend just buying the first dividend stock you see. Here's a curated list of interesting stocks that are strong dividend payers.

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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.