Yahoo Finance Hingham Institution for Savings (NASDAQ:HIFS) Could Be A Buy For Its Upcoming Dividend
Hingham Institution for Savings (NASDAQ:HIFS) stock is about to trade ex-dividend in 4 days. You can purchase shares before the 2nd of October in order to receive the dividend, which the company will pay on the 14th of October.
Hingham Institution for Savings's next dividend payment will be US$0.45 per share. Last year, in total, the company distributed US$2.32 to shareholders. Last year's total dividend payments show that Hingham Institution for Savings has a trailing yield of 1.3% on the current share price of $183.95. Dividends are a major contributor to investment returns for long term holders, but only if the dividend continues to be paid. That's why we should always check whether the dividend payments appear sustainable, and if the company is growing.
View our latest analysis for Hingham Institution for Savings
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. Hingham Institution for Savings paid out just 9.1% of its profit last year, which we think is conservatively low and leaves plenty of margin for unexpected circumstances.
Generally speaking, the lower a company's payout ratios, the more resilient its dividend usually is.
Click here to see how much of its profit Hingham Institution for Savings paid out over the last 12 months.
Have Earnings And Dividends Been Growing?
Businesses with strong growth prospects usually make the best dividend payers, because it's easier to grow dividends when earnings per share are improving. Investors love dividends, so if earnings fall and the dividend is reduced, expect a stock to be sold off heavily at the same time. Fortunately for readers, Hingham Institution for Savings's earnings per share have been growing at 12% a year for the past five years.
Many investors will assess a company's dividend performance by evaluating how much the dividend payments have changed over time. In the last 10 years, Hingham Institution for Savings has lifted its dividend by approximately 7.7% a year on average. We're glad to see dividends rising alongside earnings over a number of years, which may be a sign the company intends to share the growth with shareholders.
To Sum It Up
Has Hingham Institution for Savings got what it takes to maintain its dividend payments? Companies like Hingham Institution for Savings that are growing rapidly and paying out a low fraction of earnings, are usually reinvesting heavily in their business. Perhaps even more importantly - this can sometimes signal management is focused on the long term future of the business. Overall, Hingham Institution for Savings looks like a promising dividend stock in this analysis, and we think it would be worth investigating further.
In light of that, while Hingham Institution for Savings has an appealing dividend, it's worth knowing the risks involved with this stock. Every company has risks, and we've spotted 1 warning sign for Hingham Institution for Savings you should know about.
If you're in the market for dividend stocks, we recommend checking our list of top dividend stocks with a greater than 2% yield and an upcoming dividend.
This article by Simply Wall St is general in nature. 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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