Yahoo Finance Central Pacific Financial (NYSE:CPF) Will Pay A Dividend Of $0.26
Central Pacific Financial Corp. (NYSE:CPF) will pay a dividend of $0.26 on the 17th of June. The dividend yield will be 5.2% based on this payment which is still above the industry average.
Check out our latest analysis for Central Pacific Financial
Central Pacific Financial's Payment Expected To Have Solid Earnings Coverage
A big dividend yield for a few years doesn't mean much if it can't be sustained.
Having distributed dividends for at least 10 years, Central Pacific Financial has a long history of paying out a part of its earnings to shareholders. Past distributions do not necessarily guarantee future ones, but Central Pacific Financial's payout ratio of 51% is a good sign as this means that earnings decently cover dividends.
Over the next year, EPS is forecast to expand by 8.5%. If the dividend continues on this path, the future payout ratio could be 52% by next year, which we think can be pretty sustainable going forward.
Central Pacific Financial Has A Solid Track Record
The company has an extended history of paying stable dividends. Since 2014, the dividend has gone from $0.32 total annually to $1.04. This means that it has been growing its distributions at 13% 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.
Dividend Growth May Be Hard To Achieve
Some investors will be chomping at the bit to buy some of the company's stock based on its dividend history. Let's not jump to conclusions as things might not be as good as they appear on the surface. Central Pacific Financial hasn't seen much change in its earnings per share over the last five years.
In Summary
Overall, we think Central Pacific Financial is a solid choice as a dividend stock, even though the dividend wasn't raised this year. While the payments look sustainable for now, earnings have been shrinking so the dividend could come under pressure in the future. This looks like it could be a good dividend stock going forward, but we would note that the payout ratio has been at higher levels in the past so it could happen again.
Companies possessing a stable dividend policy will likely enjoy greater investor interest than those suffering from a more inconsistent approach. Still, investors need to consider a host of other factors, apart from dividend payments, when analysing a company. Now, if you want to look closer, it would be worth checking out our free research on Central Pacific Financial management tenure, salary, and performance. Is Central Pacific Financial not quite the opportunity you were looking for? Why not check out our selection of top 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.
