Saudi Arabian Oil's Dividend in Focus as Ex-Dividend Date Approaches

Saudi Arabian Oil Company (TADAWUL:2222) is about to trade ex-dividend in three days. The company's upcoming dividend is 0.3393 riyals a share, following on from last year when the company distributed 1.33 riyals per share to shareholders.

The trailing yield of Saudi Arabian Oil is 5.0% based on its current stock price of 26.48 riyals. 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.

The company's dividend payout ratio is 80% of profit, which means the company is paying out a majority of its earnings. However, this high payout ratio is coupled with a company that paid out less in dividends than it reported in profits but didn't generate enough cash to cover the dividend.