HarborOne Bancorp's (NASDAQ:HONE) Dividend Will Be $0.075

HarborOne Bancorp, Inc. (NASDAQ:HONE) has announced that it will pay a dividend of $0.075 per share on the 26th of April. This means the annual payment will be 2.3% of the current stock price, which is lower than the industry average.

Check out our latest analysis for HarborOne Bancorp

HarborOne Bancorp's Earnings Will Easily Cover The Distributions

Even a low dividend yield can be attractive if it is sustained for years on end.

Having paid out dividends for only 3 years, HarborOne Bancorp does not have much of a history being a dividend paying company. Based on HarborOne Bancorp's last earnings report, calculating for its payout ratio equates to 29%, which means that the company covered its last dividend with comfortable room to spare.

Looking forward, EPS is forecast to rise by 6.3% over the next 3 years. The future payout ratio could be 29% over that time period, according to analyst estimates, which is a good look for the future of the dividend.

HarborOne Bancorp Doesn't Have A Long Payment History

Looking back, the dividend has been stable, but the company hasn't been paying a dividend for very long so we can't be confident that the dividend will remain stable through all economic environments. Since 2020, the dividend has gone from $0.12 total annually to $0.28. This means that it has been growing its distributions at 33% per annum over that time. HarborOne Bancorp has been growing its dividend quite rapidly, which is exciting. However, the short payment history makes us question whether this performance will persist across a full market cycle.

The Dividend Looks Likely To Grow

Investors could be attracted to the stock based on the quality of its payment history. HarborOne Bancorp has seen EPS rising for the last five years, at 40% per annum. Earnings have been growing rapidly, and with a low payout ratio we think that the company could turn out to be a great dividend stock.

HarborOne Bancorp Looks Like A Great Dividend Stock

Overall, we like to see the dividend staying consistent, and we think HarborOne Bancorp might even raise payments in the future. Distributions are quite easily covered by earnings, which are also being converted to cash flows. All in all, this checks a lot of the boxes we look for when choosing an income stock.

It's important to note that companies having a consistent dividend policy will generate greater investor confidence than those having an erratic one. Meanwhile, despite the importance of dividend payments, they are not the only factors our readers should know when assessing a company. Case in point: We've spotted 2 warning signs for HarborOne Bancorp (of which 1 is a bit concerning!) you should know about. Is HarborOne Bancorp 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.