Stock Analysis
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There's A Lot To Like About First Community's (NASDAQ:FCCO) Upcoming US$0.12 Dividend
It looks like First Community Corporation (NASDAQ:FCCO) is about to go ex-dividend in the next four days. You can purchase shares before the 1st of February in order to receive the dividend, which the company will pay on the 16th of February.
First Community's next dividend payment will be US$0.12 per share, on the back of last year when the company paid a total of US$0.48 to shareholders. Based on the last year's worth of payments, First Community stock has a trailing yield of around 2.7% on the current share price of $17.89. If you buy this business for its dividend, you should have an idea of whether First Community's dividend is reliable and sustainable. As a result, readers should always check whether First Community has been able to grow its dividends, or if the dividend might be cut.
Check out our latest analysis for First Community
Dividends are typically paid out of company income, so if a company pays out more than it earned, its dividend is usually at a higher risk of being cut. That's why it's good to see First Community paying out a modest 35% of its earnings.
Generally speaking, the lower a company's payout ratios, the more resilient its dividend usually is.
Click here to see the company's payout ratio, plus analyst estimates of its future dividends.
Have Earnings And Dividends Been Growing?
Stocks in companies that generate sustainable earnings growth often make the best dividend prospects, as it is easier to lift the dividend when earnings are rising. Investors love dividends, so if earnings fall and the dividend is reduced, expect a stock to be sold off heavily at the same time. This is why it's a relief to see First Community earnings per share are up 7.7% per annum over the last five years.
Another key way to measure a company's dividend prospects is by measuring its historical rate of dividend growth. Since the start of our data, 10 years ago, First Community has lifted its dividend by approximately 12% a year on average. We're glad to see dividends rising alongside earnings over a number of years, which may be a sign the company intends to share the growth with shareholders.
To Sum It Up
Should investors buy First Community for the upcoming dividend? First Community has seen its earnings per share grow slowly in recent years, and the company reinvests more than half of its profits in the business, which generally bodes well for its future prospects. Overall, First Community looks like a promising dividend stock in this analysis, and we think it would be worth investigating further.
Curious what other investors think of First Community? See what analysts are forecasting, with this visualisation of its historical and future estimated earnings and cash flow.
A common investment mistake is buying the first interesting stock you see. Here you can find a list of promising dividend stocks with a greater than 2% yield and an upcoming dividend.
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What are the risks and opportunities for First Community?
First Community Corporation operates as the bank holding company for First Community Bank which offers various commercial and retail banking products and services to small-to-medium sized businesses, professional concerns, and individuals.
Rewards
Trading at 13.4% below our estimate of its fair value
Earnings are forecast to grow 4.09% per year
Risks
No risks detected for FCCO from our risks checks.
Further research on
First Community
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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About NasdaqCM:FCCO
First Community
First Community Corporation operates as the bank holding company for First Community Bank which offers various commercial and retail banking products and services to small-to-medium sized businesses, professional concerns, and individuals.
Flawless balance sheet established dividend payer.
