HomeTrust Bancshares (NASDAQ:HTBI) Has Announced A Dividend Of $0.09

The board of HomeTrust Bancshares, Inc. (NASDAQ:HTBI) has announced that it will pay a dividend on the 1st of September, with investors receiving $0.09 per share. This means the annual payment will be 1.5% of the current stock price, which is lower than the industry average.

See our latest analysis for HomeTrust Bancshares

HomeTrust Bancshares' Payment Expected To Have Solid Earnings Coverage

If it is predictable over a long period, even low dividend yields can be attractive.

HomeTrust Bancshares is just starting to establish itself as being able to pay dividends to shareholders, given its short 4-year history of distributing earnings. While it has a shorter history of paying out dividends, HomeTrust Bancshares' payout ratio of 15% is a great sign for current shareholders, as this means that earnings greatly cover dividends.

Over the next 3 years, EPS is forecast to expand by 4.0%. The future payout ratio could be 15% over that time period, according to analyst estimates, which is a good look for the future of the dividend.

HomeTrust Bancshares Is Still Building Its Track Record

The dividend has been pretty stable looking back, but the company hasn't been paying one for very long. This makes it tough to judge how it would fare through a full economic cycle. The dividend has gone from an annual total of $0.24 in 2018 to the most recent total annual payment of $0.36. This means that it has been growing its distributions at 11% per annum over that time. We're not overly excited about the relatively short history of dividend payments, however the dividend is growing at a nice rate and we might take a closer look.

The Dividend Looks Likely To Grow

Some investors will be chomping at the bit to buy some of the company's stock based on its dividend history. It's encouraging to see that HomeTrust Bancshares has been growing its earnings per share at 28% a year over the past five years. Earnings per share is growing at a solid clip, and the payout ratio is low which we think is an ideal combination in a dividend stock as the company can quite easily raise the dividend in the future.

HomeTrust Bancshares Looks Like A Great Dividend Stock

Overall, we like to see the dividend staying consistent, and we think HomeTrust Bancshares might even raise payments in the future. Distributions are quite easily covered by earnings, which are also being converted to cash flows. 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. Meanwhile, despite the importance of dividend payments, they are not the only factors our readers should know when assessing a company. Earnings growth generally bodes well for the future value of company dividend payments. See if the 3 HomeTrust Bancshares analysts we track are forecasting continued growth with our free report on 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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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.