Banco de Sabadell, S.A. (BME:SAB) Is Yielding 3.1% - But Is It A Buy?
Today we'll take a closer look at Banco de Sabadell, S.A. (BME:SAB) from a dividend investor's perspective. Owning a strong business and reinvesting the dividends is widely seen as an attractive way of growing your wealth. Yet sometimes, investors buy a stock for its dividend and lose money because the share price falls by more than they earned in dividend payments. With Banco de Sabadell yielding 3.1% and having paid a dividend for over 10 years, many investors likely find the company quite interesting. Companies (usually) pay dividends out of their earnings. If a company is paying more than it earns, the dividend might have to be cut. So we need to form a view on if a company's dividend is sustainable, relative to its net profit after tax.