Princeton Bancorp's (NASDAQ:BPRN) Dividend Will Be $0.30

Princeton Bancorp, Inc. (NASDAQ:BPRN) will pay a dividend of $0.30 on the 28th of November. Based on this payment, the dividend yield will be 3.4%, which is fairly typical for the industry.

See our latest analysis for Princeton Bancorp

Princeton Bancorp's Dividend Forecasted To Be Well Covered By Earnings

Unless the payments are sustainable, the dividend yield doesn't mean too much.

Having paid out dividends for 6 years, Princeton Bancorp has a good history of paying out a part of its earnings to shareholders. Past distributions do not necessarily guarantee future ones, but Princeton Bancorp's payout ratio of 69% is a good sign for current shareholders as this means that earnings decently cover dividends.

Looking forward, EPS is forecast to rise by 176.6% over the next 3 years. Analysts forecast the future payout ratio could be 31% over the same time horizon, which is a number we think the company can maintain.

Princeton Bancorp Is Still Building Its Track Record

The dividend's track record has been pretty solid, but with only 6 years of history we want to see a few more years of history before making any solid conclusions. The annual payment during the last 6 years was $0.12 in 2018, and the most recent fiscal year payment was $1.20. This works out to be a compound annual growth rate (CAGR) of approximately 47% a year over that time. The dividend has been growing rapidly, however with such a short payment history we can't know for sure if payment can continue to grow over the long term, so caution may be warranted.

The Dividend's Growth Prospects Are Limited

Investors could be attracted to the stock based on the quality of its payment history. Princeton Bancorp hasn't seen much change in its earnings per share over the last five years. Princeton Bancorp is struggling to find viable investments, so it is returning more to shareholders. This isn't necessarily bad, but we wouldn't expect rapid dividend growth in the future.

Our Thoughts On Princeton Bancorp's Dividend

In summary, we are pleased with the dividend remaining consistent, and we think there is a good chance of this continuing in the future. The dividend has been at reasonable levels historically, but that hasn't translated into a consistent payment. The payment isn't stellar, but it could make a decent addition to a dividend portfolio.

Companies possessing a stable dividend policy will likely enjoy greater investor interest than those suffering from a more inconsistent approach. However, there are other things to consider for investors when analysing stock performance. For instance, we've picked out 5 warning signs for Princeton Bancorp that investors should take into consideration. Is Princeton Bancorp 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.