Ensure Comprehensive Checks Before Considering GS Retail Co., Ltd. (KRX:007070) for Its Upcoming Dividend

Ex-Dividend Drama: The GS Retail Situation

Alright folks, so you heard it here: GS Retail Co., Ltd. (KRX:007070), that go-to place for your last-minute shopping sprees, is about to go ex-dividend in three days. The elephant in the room? Mark your calendars because before the 27th of February, you’ve got to own these shares if you’re looking to cash in on that dividend check they’re planning to drop on January 1st.

The Dividend Dilemma

Now, let’s talk turkey. GS Retail is flashing a tribute of ₩500.00 per share this round. Over the past 12 months, it’s been pampering its loyal investors with a tidy ₩619 per share. That’s bringing in a trailing yield of a solid 3.9% based on the current share price of ₩15,990.00. Sounds rosy, right? But doing your due diligence is crucial. You’ve got to wonder, though: is this an elite investment that’s just too good to be true?

Cold Cash and Cold Truths

Let’s break it down. Can you trust a dividend when the company barely makes any dough? Unsurprisingly, GS Retail seems to splurge a little. It’s dishing out more in dividends than its earnings can support—yes, despite last year’s losses.

Should you find out if the free cash flow is just an illusion? Hop over to our latest analysis to dig deeper. But here’s the spicy bit: GS Retail paid out a wild 122% of its free cash flow last year. That’s one of those eyebrow-raising numbers.

The Growing Pains of Earnings

When you dive into dividends, consider the financial swan dive that happens when earnings tank. Unfortunately, they’ve been on this slippery slope for a while now. After dishing out more than they earned, it doesn’t take a genius to foresee possible dividend cuts. Historically, GS Retail has been timidly slashing dividends by about 5.1% annually over the past five years.

Sorting the Mess

Now, is GS Retail a basket of investment goodies or a hornet’s nest? Investing in a company reporting losses and insufficient cash flows can be awkward. Not to mention: a dividend policy hanging by a thread is not savory. Are you the gambling type?

Got cold feet but still curious? Analyze GS Retail’s balance sheet health before making a move.

The Final Word

Considering GS Retail for its impending dividend? It’s an enigma wrapped in uncertainty. Losing money hasn’t stopped them from a payout, but is it sustainable? Odds are you might want to pass for now unless you’re up for a nerve-wracking ride.

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By Simply Wall St. Please note this isn’t financial advice. It’s engaging, data-driven analysis for the savvy investor. It’s not a buy or sell suggestion and doesn’t factor in your situation.