GCM Grosvenor Inc. (NASDAQ:GCMG) Is About To Go Ex-Dividend, And It Pays A 4.4% Yield

Readers hoping to buy GCM Grosvenor Inc. (NASDAQ:GCMG) for its dividend will need to make their move shortly, as the stock is about to trade ex-dividend. The ex-dividend date occurs one day before the record date which is the day on which shareholders need to be on the company's books in order to receive a dividend. It is important to be aware of the ex-dividend date because any trade on the stock needs to have been settled on or before the record date. Meaning, you will need to purchase GCM Grosvenor's shares before the 3rd of June to receive the dividend, which will be paid on the 17th of June.

The company's next dividend payment will be US$0.11 per share, and in the last 12 months, the company paid a total of US$0.44 per share. Looking at the last 12 months of distributions, GCM Grosvenor has a trailing yield of approximately 4.4% on its current stock price of US$10.01. 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.

View our latest analysis for GCM Grosvenor

If a company pays out more in dividends than it earned, then the dividend might become unsustainable - hardly an ideal situation. GCM Grosvenor paid out 119% of profit in the past year, which we think is typically not sustainable unless there are mitigating characteristics such as unusually strong cash flow or a large cash balance.

When a company pays out a dividend that is not well covered by profits, the dividend is generally seen as more vulnerable to being cut.

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

Have Earnings And Dividends Been Growing?

Companies with consistently growing earnings per share generally make the best dividend stocks, as they usually find it easier to grow dividends per share. If earnings decline and the company is forced to cut its dividend, investors could watch the value of their investment go up in smoke. That's why it's comforting to see GCM Grosvenor's earnings have been skyrocketing, up 53% per annum for the past five years.

Many investors will assess a company's dividend performance by evaluating how much the dividend payments have changed over time. In the past three years, GCM Grosvenor has increased its dividend at approximately 22% a year on average. It's great to see earnings per share growing rapidly over several years, and dividends per share growing right along with it.

To Sum It Up

Is GCM Grosvenor worth buying for its dividend? We're not enthused to see GCM Grosvenor's dividend was not well covered by earnings over the last year, although it is great to see earnings growing. We think there are likely better opportunities out there.

With that being said, if dividends aren't your biggest concern with GCM Grosvenor, you should know about the other risks facing this business. To that end, you should learn about the 3 warning signs we've spotted with GCM Grosvenor (including 1 which is concerning).

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.