First Hawaiian's (NASDAQ:FHB) Dividend Will Be $0.26

The board of First Hawaiian, Inc. (NASDAQ:FHB) has announced that it will pay a dividend on the 29th of August, with investors receiving $0.26 per share. This makes the dividend yield 4.2%, which will augment investor returns quite nicely.

We've found 21 US stocks that are forecast to pay a dividend yield of over 6% next year. See the full list for free.

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

While it is great to have a strong dividend yield, we should also consider whether the payment is sustainable.

First Hawaiian has established itself as a dividend paying company, given its 9-year history of distributing earnings to shareholders. Past distributions do not necessarily guarantee future ones, but First Hawaiian's payout ratio of 53% is a good sign for current shareholders as this means that earnings decently cover dividends.

The next 3 years are set to see EPS grow by 11.6%. The future payout ratio could be 50% over that time period, according to analyst estimates, which is a good look for the future of the dividend.

View our latest analysis for First Hawaiian

First Hawaiian Is Still Building Its Track Record

Even though the company has been paying a consistent dividend for a while, we would like to see a few more years before we feel comfortable relying on it. The annual payment during the last 9 years was $0.80 in 2016, and the most recent fiscal year payment was $1.04. This means that it has been growing its distributions at 3.0% per annum over that time. We like that the dividend hasn't been shrinking. However we're conscious that the company hasn't got an overly long track record of dividend payments yet, which makes us wary of relying on its dividend income.

First Hawaiian Could Grow Its Dividend

The company's investors will be pleased to have been receiving dividend income for some time. First Hawaiian has seen EPS rising for the last five years, at 5.2% per annum. Shareholders are getting plenty of the earnings returned to them, which combined with strong growth makes this quite appealing.

Our Thoughts On First Hawaiian'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 payout ratio looks good, but unfortunately the company's dividend track record isn't stellar. The dividend looks okay, but there have been some issues in the past, so we would be a little bit cautious.

Market movements attest to how highly valued a consistent dividend policy is compared to one which is more unpredictable. Still, investors need to consider a host of other factors, apart from dividend payments, when analysing a company. Companies that are growing earnings tend to be the best dividend stocks over the long term. See what the 6 analysts we track are forecasting for First Hawaiian for free with public analyst estimates for the company. If you are a dividend investor, you might also want to look at our curated list of high yield dividend stocks.

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