Tsukuba Bank (TSE:8338) Is Paying Out A Dividend Of ¥5.00

Tsukuba Bank, Ltd. (TSE:8338) will pay a dividend of ¥5.00 on the 6th of June. This means the annual payment will be 2.2% of the current stock price, which is lower than the industry average.

See our latest analysis for Tsukuba Bank

Tsukuba Bank's Payment Expected To Have Solid Earnings Coverage

Even a low dividend yield can be attractive if it is sustained for years on end.

Tsukuba Bank has established itself as a dividend paying company with over 10 years history of distributing earnings to shareholders. While past records don't necessarily translate into future results, the company's payout ratio of 19% also shows that Tsukuba Bank is able to comfortably pay dividends.

Over the next year, EPS could expand by 16.8% if recent trends continue. If the dividend continues along recent trends, we estimate the future payout ratio will be 16%, which is in the range that makes us comfortable with the sustainability of the dividend.

Tsukuba Bank Has A Solid Track Record

The company has a sustained record of paying dividends with very little fluctuation. The last annual payment of ¥5.00 was flat on the annual payment from10 years ago. While the consistency in the dividend payments is impressive, we think the relatively slow rate of growth is less attractive.

The Dividend Looks Likely To Grow

Some investors will be chomping at the bit to buy some of the company's stock based on its dividend history. It's encouraging to see that Tsukuba Bank has been growing its earnings per share at 17% a year over the past five years. A low payout ratio and decent growth suggests that the company is reinvesting well, and it also has plenty of room to increase the dividend over time.

Tsukuba Bank Looks Like A Great Dividend Stock

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. Distributions are quite easily covered by earnings, which are also being converted to cash flows. Taking this all into consideration, this looks like it could be a good dividend opportunity.

Market movements attest to how highly valued a consistent dividend policy is compared to one which is more unpredictable. However, there are other things to consider for investors when analysing stock performance. See if management have their own wealth at stake, by checking insider shareholdings in Tsukuba Bank stock. Is Tsukuba Bank 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.