Yahoo Finance Bank of the James Financial Group (NASDAQ:BOTJ) Will Pay A Dividend Of $0.07
Bank of the James Financial Group, Inc. (NASDAQ:BOTJ) will pay a dividend of $0.07 on the 16th of September. Including this payment, the dividend yield on the stock will be 2.2%, which is a modest boost for shareholders' returns.
Check out our latest analysis for Bank of the James Financial Group
Bank of the James Financial Group'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.
Bank of the James Financial Group has a good history of paying out dividends, with its current track record at 8 years. Using data from its latest earnings report, Bank of the James Financial Group's payout ratio sits at 16%, an extremely comfortable number that shows that it can pay its dividend.
Looking forward, earnings per share could rise by 23.5% over the next year if the trend from the last few years continues. If the dividend continues along recent trends, we estimate the future payout ratio will be 14%, which is in the range that makes us comfortable with the sustainability of the dividend.
Bank of the James Financial Group Doesn't Have A Long Payment History
It is great to see that Bank of the James Financial Group has been paying a stable dividend for a number of years now, however we want to be a bit cautious about whether this will remain true through a full economic cycle. Since 2014, the annual payment back then was $0.182, compared to the most recent full-year payment of $0.28. This implies that the company grew its distributions at a yearly rate of about 5.5% over that duration. Investors will likely want to see a longer track record of growth before making decision to add this to their income portfolio.
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 Bank of the James Financial Group has grown earnings per share at 23% per year over the past five years. Earnings per share is growing at a solid clip, and the payout ratio is low which we think is an ideal combination in a dividend stock as the company can quite easily raise the dividend in the future.
We Really Like Bank of the James Financial Group'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. Earnings are easily covering distributions, and the company is generating plenty of cash. All of these factors considered, we think this has solid potential as a dividend stock.
Market movements attest to how highly valued a consistent dividend policy is compared to one which is more unpredictable. Still, investors need to consider a host of other factors, apart from dividend payments, when analysing a company. As an example, we've identified 2 warning signs for Bank of the James Financial Group 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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