Regular readers will know that we love our dividends at Simply Wall St, which is why it's exciting to see Simmons First National Corporation (NASDAQ:SFNC) is about to trade ex-dividend in the next four days. The ex-dividend date is usually set to be one business day before the record date which is the cut-off date on which you must be present on the company's books as a shareholder in order to receive the 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 Simmons First National's shares before the 14th of December in order to receive the dividend, which the company will pay on the 2nd of January.
The company's next dividend payment will be US$0.20 per share, and in the last 12 months, the company paid a total of US$0.80 per share. Looking at the last 12 months of distributions, Simmons First National has a trailing yield of approximately 4.5% on its current stock price of $17.79. If you buy this business for its dividend, you should have an idea of whether Simmons First National's dividend is reliable and sustainable. So we need to investigate whether Simmons First National can afford its dividend, and if the dividend could grow.
See our latest analysis for Simmons First National
Dividends are typically paid from company earnings. If a company pays more in dividends than it earned in profit, then the dividend could be unsustainable. Fortunately Simmons First National's payout ratio is modest, at just 43% of profit.
When a company paid out less in dividends than it earned in profit, this generally suggests its dividend is affordable. The lower the % of its profit that it pays out, the greater the margin of safety for the dividend if the business enters a downturn.
Click here to see the company's payout ratio, plus analyst estimates of its future dividends.
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. If earnings decline and the company is forced to cut its dividend, investors could watch the value of their investment go up in smoke. With that in mind, we're encouraged by the steady growth at Simmons First National, with earnings per share up 6.9% on average over the last five years.
Many investors will assess a company's dividend performance by evaluating how much the dividend payments have changed over time. Since the start of our data, 10 years ago, Simmons First National has lifted its dividend by approximately 6.7% a year on average. It's encouraging to see the company lifting dividends while earnings are growing, suggesting at least some corporate interest in rewarding shareholders.
The Bottom Line
Is Simmons First National worth buying for its dividend? It has been growing its earnings per share somewhat in recent years, although it reinvests more than half its earnings in the business, which could suggest there are some growth projects that have not yet reached fruition. We think this is a pretty attractive combination, and would be interested in investigating Simmons First National more closely.
So while Simmons First National looks good from a dividend perspective, it's always worthwhile being up to date with the risks involved in this stock. To help with this, we've discovered 1 warning sign for Simmons First National that you should be aware of before investing in their shares.
A common investing mistake is buying the first interesting stock you see. Here you can find a full list of high-yield dividend stocks.
Have feedback on this article? Concerned about the content?Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com. 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.
普通读者会知道我们喜欢Simply Wall St的股息,这就是为什么看到西蒙斯第一国民公司(纳斯达克股票代码:SFNC)即将在未来四天内进行除息交易令人兴奋的原因。除息日通常设置为记录日期前一个工作日,即您必须作为股东出现在公司账簿上才能获得股息的截止日期。除息日之所以如此,是因为无论何时买入或卖出股票,交易都需要至少两个工作日才能结算。因此,您可以在12月14日之前购买Simmons First National的股票,以获得股息,该公司将在1月2日支付股息。
该公司的下一次股息将为每股0.20美元,在过去的12个月中,该公司共支付了每股0.80美元。从过去12个月的分配情况来看,西蒙斯第一国民的追踪收益率约为4.5%,而目前的股价为17.79美元。如果你收购这家企业是为了分红,你应该知道席梦思第一国民的股息是否可靠和可持续。因此,我们需要调查Simmons First National能否负担得起股息,以及股息是否可以增加。