First Busey (NASDAQ:BUSE) Will Pay A Dividend Of $0.24

First Busey Corporation's (NASDAQ:BUSE) investors are due to receive a payment of $0.24 per share on 26th of July. This means that the annual payment will be 3.8% of the current stock price, which is in line with the average for the industry.

View our latest analysis for First Busey

First Busey's Dividend Forecasted To Be Well Covered By Earnings

We aren't too impressed by dividend yields unless they can be sustained over time.

Having distributed dividends for at least 10 years, First Busey has a long history of paying out a part of its earnings to shareholders. Taking data from its last earnings report, calculating for the company's payout ratio shows 48%, which means that First Busey would be able to pay its last dividend without pressure on the balance sheet.

Over the next year, EPS is forecast to expand by 8.3%. If the dividend continues along recent trends, we estimate the future payout ratio will be 48%, which is in the range that makes us comfortable with the sustainability of the dividend.

First Busey Has A Solid Track Record

The company has an extended history of paying stable dividends. The annual payment during the last 10 years was $0.48 in 2014, and the most recent fiscal year payment was $0.96. This means that it has been growing its distributions at 7.2% per annum over that time. The dividend has been growing very nicely for a number of years, and has given its shareholders some nice income in their portfolios.

First Busey May Find It Hard To Grow The Dividend

Investors who have held shares in the company for the past few years will be happy with the dividend income they have received. Let's not jump to conclusions as things might not be as good as they appear on the surface. First Busey hasn't seen much change in its earnings per share over the last five years.

Our Thoughts On First Busey's Dividend

Overall, we think First Busey is a solid choice as a dividend stock, even though the dividend wasn't raised this year. With shrinking earnings, the company may see some issues maintaining the dividend even though they look pretty sustainable for now. 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. However, there are other things to consider for investors when analysing stock performance. For example, we've picked out 1 warning sign for First Busey that investors should know about before committing capital to this stock. Is First Busey 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.

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