Yahoo Finance Dividend Investors: Don't Be Too Quick To Buy CB Financial Services, Inc. (NASDAQ:CBFV) For Its Upcoming Dividend
Some investors rely on dividends for growing their wealth, and if you're one of those dividend sleuths, you might be intrigued to know that CB Financial Services, Inc. (NASDAQ:CBFV) is about to go ex-dividend in just four days. Ex-dividend means that investors that purchase the stock on or after the 3rd of December will not receive this dividend, which will be paid on the 15th of December.
CB Financial Services's next dividend payment will be US$0.24 per share, on the back of last year when the company paid a total of US$0.96 to shareholders. Last year's total dividend payments show that CB Financial Services has a trailing yield of 4.2% on the current share price of $22.8. Dividends are an important source of income to many shareholders, but the health of the business is crucial to maintaining those dividends. So we need to check whether the dividend payments are covered, and if earnings are growing.
Check out our latest analysis for CB Financial Services
If a company pays out more in dividends than it earned, then the dividend might become unsustainable - hardly an ideal situation. CB Financial Services paid a dividend last year despite being unprofitable. This might be a one-off event, but it's not a sustainable state of affairs in the long run.
Click here to see the company's payout ratio, plus analyst estimates of its future dividends.
Have Earnings And Dividends Been Growing?
Companies with falling earnings are riskier for dividend shareholders. Investors love dividends, so if earnings fall and the dividend is reduced, expect a stock to be sold off heavily at the same time. CB Financial Services was unprofitable last year and, unfortunately, the general trend suggests its earnings have been in decline over the last five years, making us wonder if the dividend is sustainable at all.
Many investors will assess a company's dividend performance by evaluating how much the dividend payments have changed over time. In the past six years, CB Financial Services has increased its dividend at approximately 2.3% a year on average.
We update our analysis on CB Financial Services every 24 hours, so you can always get the latest insights on its financial health, here.
To Sum It Up
Is CB Financial Services worth buying for its dividend? It's definitely not great to see that it paid a dividend despite reporting a loss last year. Worse, the general trend in its earnings looks negative in recent times. CB Financial Services doesn't appear to have a lot going for it, and we're not inclined to take a risk on owning it for the dividend.
Although, if you're still interested in CB Financial Services and want to know more, you'll find it very useful to know what risks this stock faces. For example, we've found 1 warning sign for CB Financial Services that we recommend you consider before investing in the business.
We wouldn't recommend just buying the first dividend stock you see, though. Here's a list of interesting 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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