First of Long Island (NASDAQ:FLIC) Has Announced A Dividend Of $0.21

The board of The First of Long Island Corporation (NASDAQ:FLIC) has announced that it will pay a dividend of $0.21 per share on the 24th of March. This makes the dividend yield 5.0%, which will augment investor returns quite nicely.

Check out our latest analysis for First of Long Island

First of Long Island'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.

Having distributed dividends for at least 10 years, First of Long Island 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 40%, which means that First of Long Island would be able to pay its last dividend without pressure on the balance sheet.

EPS is set to fall by 16.4% over the next 3 years. Fortunately, analysts forecast the future payout ratio to be 46% over the same time horizon, which is in the range that makes us comfortable with the sustainability of the dividend.

First of Long Island Has A Solid Track Record

The company has a sustained record of paying dividends with very little fluctuation. Since 2013, the annual payment back then was $0.409, compared to the most recent full-year payment of $0.84. This works out to be a compound annual growth rate (CAGR) of approximately 7.5% a year over that time. Companies like this can be very valuable over the long term, if the decent rate of growth can be maintained.

First of Long Island Could Grow Its Dividend

Investors who have held shares in the company for the past few years will be happy with the dividend income they have received. First of Long Island has seen EPS rising for the last five years, at 7.7% per annum. With a decent amount of growth and a low payout ratio, we think this bodes well for First of Long Island's prospects of growing its dividend payments in the future.

We Really Like First of Long Island's Dividend

In summary, it is good to see that the dividend is staying consistent, and we don't think there is any reason to suspect this might change over the medium term. The earnings easily cover the company's distributions, and the company is generating plenty of cash. If earnings do fall over the next 12 months, the dividend could be buffeted a little bit, but we don't think it should cause too much of a problem in the long term. Taking this all into consideration, this looks like it could be a good dividend opportunity.

Market movements attest to how highly valued a consistent dividend policy is compared to one which is more unpredictable. At the same time, there are other factors our readers should be conscious of before pouring capital into a stock. Taking the debate a bit further, we've identified 1 warning sign for First of Long Island that investors need to be conscious of moving forward. Is First of Long Island not quite the opportunity you were looking for? Why not check out our selection of top dividend stocks.

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