Dun & Bradstreet Holdings, Inc. (NYSE:DNB) will pay a dividend of $0.05 on the 19th of December. This means the dividend yield will be fairly typical at 1.6%.

Check out our latest analysis for Dun & Bradstreet Holdings

Dun & Bradstreet Holdings' Projections Indicate Future Payments May Be Unsustainable

Estimates Indicate Dun & Bradstreet Holdings' Could Struggle to Maintain Dividend Payments In The Future

Dun & Bradstreet Holdings' Future Dividends May Potentially Be At Risk

We like to see a healthy dividend yield, but that is only helpful to us if the payment can continue. While Dun & Bradstreet Holdings is not profitable, it is paying out less than 75% of its free cash flow, which means that there is plenty left over for reinvestment into the business. We generally think that cash flow is more important than accounting measures of profit, so we are fairly comfortable with the dividend at this level.

Earnings per share is forecast to rise exponentially over the next year. Assuming the dividend continues along recent trends, we could see the payout ratio reach 111%, which is on the unsustainable side.

Dun & Bradstreet Holdings Doesn't Have A Long Payment History

The dividend has been pretty stable looking back, but the company hasn't been paying one for very long. This makes it tough to judge how it would fare through a full economic cycle. The payments haven't really changed that much since 2 years ago. Dun & Bradstreet Holdings hasn't been paying a dividend for very long, so we wouldn't get to excited about its record of growth just yet.

The Company Could Face Some Challenges Growing The Dividend

Investors could be attracted to the stock based on the quality of its payment history. It's encouraging to see that Dun & Bradstreet Holdings has been growing its earnings per share at 90% a year over the past five years. Even though the company is not profitable, it is growing at a solid clip. If this trajectory continues and the company can turn a profit soon, it could bode well for the dividend going forward.

In Summary

In summary, while it's good to see that the dividend hasn't been cut, we are a bit cautious about Dun & Bradstreet Holdings' payments, as there could be some issues with sustaining them into the future. The company is generating plenty of cash, which could maintain the dividend for a while, but the track record hasn't been great. We would be a touch cautious of relying on this stock primarily for the dividend income.