ESSA Bancorp's (NASDAQ:ESSA) Dividend Will Be $0.15

ESSA Bancorp, Inc. (NASDAQ:ESSA) will pay a dividend of $0.15 on the 28th of June. This payment means that the dividend yield will be 3.6%, which is around the industry average.

View our latest analysis for ESSA Bancorp

ESSA Bancorp's Dividend Forecasted To Be Well Covered By Earnings

We like a dividend to be consistent over the long term, so checking whether it is sustainable is important.

ESSA Bancorp has a long history of paying out dividends, with its current track record at a minimum of 10 years. Based on ESSA Bancorp's last earnings report, the payout ratio is at a decent 32%, meaning that the company is able to pay out its dividend with a bit of room to spare.

Looking forward, earnings per share is forecast to rise by 3.7% over the next year. If the dividend continues on this path, the future payout ratio could be 33% by next year, which we think can be pretty sustainable going forward.

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ESSA Bancorp Has A Solid Track Record

The company has an extended history of paying stable dividends. Since 2014, the dividend has gone from $0.20 total annually to $0.60. This means that it has been growing its distributions at 12% per annum over that time. It is good to see that there has been strong dividend growth, and that there haven't been any cuts for a long time.

The Dividend Looks Likely To Grow

Investors who have held shares in the company for the past few years will be happy with the dividend income they have received. We are encouraged to see that ESSA Bancorp has grown earnings per share at 12% per year over the past five years. ESSA Bancorp definitely has the potential to grow its dividend in the future with earnings on an uptrend and a low payout ratio.

We Really Like ESSA Bancorp's Dividend

Overall, we think that this is a great income investment, and we think that maintaining the dividend this year may have been a conservative choice. Distributions are quite easily covered by earnings, which are also being converted to cash flows. Taking this all into consideration, this looks like it could be a good dividend opportunity.

Market movements attest to how highly valued a consistent dividend policy is compared to one which is more unpredictable. However, there are other things to consider for investors when analysing stock performance. Now, if you want to look closer, it would be worth checking out our free research on ESSA Bancorp management tenure, salary, and performance. Looking for more high-yielding dividend ideas? Try our collection of strong dividend payers.

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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.