Yahoo Finance Amerant Bancorp (NYSE:AMTB) Will Pay A Dividend Of $0.09
Amerant Bancorp Inc.'s (NYSE:AMTB) investors are due to receive a payment of $0.09 per share on 30th of August. This means the annual payment will be 1.6% of the current stock price, which is lower than the industry average.
See our latest analysis for Amerant Bancorp
Amerant Bancorp's Dividend Forecasted To Be Well Covered By Earnings
The dividend yield is a little bit low, but sustainability of the payments is also an important part of evaluating an income stock.
Amerant Bancorp is just starting to establish itself as being able to pay dividends to shareholders, given its short 3-year history of distributing earnings. Diving into the company's earnings report, the payout ratio is set at 59%, which is a decent ratio of dividend payout to earnings, and may sustain future dividends if the company stays at its current trend.
Over the next year, EPS is forecast to expand by 73.6%. If the dividend continues on this path, the future payout ratio could be 34% by next year, which we think can be pretty sustainable going forward.
Amerant Bancorp Doesn't Have A Long Payment History
The company has maintained a consistent dividend for a few years now, but we would like to see a longer track record before relying on it. Since 2021, the annual payment back then was $0.24, compared to the most recent full-year payment of $0.36. This implies that the company grew its distributions at a yearly rate of about 14% over that duration. Amerant Bancorp has been growing its dividend quite rapidly, which is exciting. However, the short payment history makes us question whether this performance will persist across a full market cycle.
Dividend Growth Potential Is Shaky
The company's investors will be pleased to have been receiving dividend income for some time. However, initial appearances might be deceiving. Amerant Bancorp's EPS has fallen by approximately 13% per year during the past five years. A sharp decline in earnings per share is not great from from a dividend perspective. Even conservative payout ratios can come under pressure if earnings fall far enough. However, the next year is actually looking up, with earnings set to rise. We would just wait until it becomes a pattern before getting too excited.
Our Thoughts On Amerant Bancorp's Dividend
In summary, while it's good to see that the dividend hasn't been cut, we are a bit cautious about Amerant Bancorp's payments, as there could be some issues with sustaining them into the future. While Amerant Bancorp is earning enough to cover the dividend, we are generally unimpressed with its future prospects. This company is not in the top tier of income providing stocks.
It's important to note that companies having a consistent dividend policy will generate greater investor confidence than those having an erratic one. Meanwhile, despite the importance of dividend payments, they are not the only factors our readers should know when assessing a company. As an example, we've identified 4 warning signs for Amerant Bancorp that you should be aware of before investing. If you are a dividend investor, you might also want to look at our curated list of high yield dividend stocks.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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