It looks like Bridgemarq Real Estate Services Inc. (TSE:BRE) is about to go ex-dividend in the next two days. The ex-dividend date is one business day before a company's record date, which is the date on which the company determines which shareholders are entitled to receive a dividend. The ex-dividend date is of consequence because whenever a stock is bought or sold, the trade takes at least two business day to settle. Thus, you can purchase Bridgemarq Real Estate Services' shares before the 29th of April in order to receive the dividend, which the company will pay on the 31st of May.

The company's upcoming dividend is CA$0.1125 a share, following on from the last 12 months, when the company distributed a total of CA$1.35 per share to shareholders. Based on the last year's worth of payments, Bridgemarq Real Estate Services stock has a trailing yield of around 9.9% on the current share price of CA$13.65. Dividends are a major contributor to investment returns for long term holders, but only if the dividend continues to be paid. As a result, readers should always check whether Bridgemarq Real Estate Services has been able to grow its dividends, or if the dividend might be cut.

Check out our latest analysis for Bridgemarq Real Estate Services

Dividends are usually paid out of company profits, so if a company pays out more than it earned then its dividend is usually at greater risk of being cut. Bridgemarq Real Estate Services paid out a disturbingly high 320% of its profit as dividends last year, which makes us concerned there's something we don't fully understand in the business. Yet cash flows are even more important than profits for assessing a dividend, so we need to see if the company generated enough cash to pay its distribution. It paid out 100% of its free cash flow in the form of dividends last year, which is outside the comfort zone for most businesses. Companies usually need cash more than they need earnings - expenses don't pay themselves - so it's not great to see it paying out so much of its cash flow.

As Bridgemarq Real Estate Services's dividend was not well covered by either earnings or cash flow, we would be concerned that this dividend could be at risk over the long term.

Click here to see how much of its profit Bridgemarq Real Estate Services paid out over the last 12 months.

Have Earnings And Dividends Been Growing?

When earnings decline, dividend companies become much harder to analyse and own safely. If earnings decline and the company is forced to cut its dividend, investors could watch the value of their investment go up in smoke. Bridgemarq Real Estate Services's earnings per share have fallen at approximately 25% a year over the previous five years. When earnings per share fall, the maximum amount of dividends that can be paid also falls.