CNB Financial (NASDAQ:CCNE) Has Affirmed Its Dividend Of $0.175

CNB Financial Corporation's (NASDAQ:CCNE) investors are due to receive a payment of $0.175 per share on 15th of March. This means that the annual payment will be 3.4% of the current stock price, which is in line with the average for the industry.

See our latest analysis for CNB Financial

CNB Financial's Payment Expected To Have Solid Earnings Coverage

While it is always good to see a solid dividend yield, we should also consider whether the payment is feasible.

Having distributed dividends for at least 10 years, CNB Financial 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 27%, which means that CNB Financial would be able to pay its last dividend without pressure on the balance sheet.

EPS is set to fall by 3.0% over the next 3 years. Despite that, analysts estimate the future payout ratio could be 28% over the same time period, which is in a pretty comfortable range.

CNB Financial Has A Solid Track Record

The company has been paying a dividend for a long time, and it has been quite stable which gives us confidence in the future dividend potential. The annual payment during the last 10 years was $0.66 in 2014, and the most recent fiscal year payment was $0.70. Dividend payments have been growing, but very slowly over the period. Although we can't deny that the dividend has been remarkably stable in the past, the growth has been pretty muted.

The Dividend's Growth Prospects Are Limited

The company's investors will be pleased to have been receiving dividend income for some time. Earnings have grown at around 3.2% a year for the past five years, which isn't massive but still better than seeing them shrink. While EPS growth is quite low, CNB Financial has the option to increase the payout ratio to return more cash to shareholders.

We Really Like CNB Financial's Dividend

Overall, we like to see the dividend staying consistent, and we think CNB Financial might even raise payments in the future. The earnings easily cover the company's distributions, and the company is generating plenty of cash. However, it is worth noting that the earnings are expected to fall over the next year, which may not change the long term outlook, but could affect the dividend payment in the next 12 months. All of these factors considered, we think this has solid potential as a dividend stock.

Investors generally tend to favour companies with a consistent, stable dividend policy as opposed to those operating an irregular one. At the same time, there are other factors our readers should be conscious of before pouring capital into a stock. As an example, we've identified 1 warning sign for CNB Financial that you should be aware of before investing. Is CNB 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.