Hancock Whitney's (NASDAQ:HWC) Dividend Will Be Increased To $0.30

Hancock Whitney Corporation (NASDAQ:HWC) will increase its dividend from last year's comparable payment on the 15th of September to $0.30. Even though the dividend went up, the yield is still quite low at only 3.0%.

See our latest analysis for Hancock Whitney

Hancock Whitney's Payment Expected To Have Solid Earnings Coverage

It would be nice for the yield to be higher, but we should also check if higher levels of dividend payment would be sustainable.

Hancock Whitney has a long history of paying out dividends, with its current track record at a minimum of 10 years. While past records don't necessarily translate into future results, the company's payout ratio of 19% also shows that Hancock Whitney is able to comfortably pay dividends.

EPS is set to fall by 15.9% over the next 12 months. But assuming the dividend continues along recent trends, we believe the future payout ratio could be 24%, which we are pretty comfortable with and we think would be feasible on an earnings basis.

Hancock Whitney Has A Solid Track Record

The company has an extended history of paying stable dividends. The dividend has gone from an annual total of $0.96 in 2013 to the most recent total annual payment of $1.20. This implies that the company grew its distributions at a yearly rate of about 2.3% over that duration. Slow and steady dividend growth might not sound that exciting, but dividends have been stable for ten years, which we think makes this a fairly attractive offer.

The Dividend Looks Likely To Grow

Investors could be attracted to the stock based on the quality of its payment history. Hancock Whitney has seen EPS rising for the last five years, at 15% per annum. Growth in EPS bodes well for the dividend, as does the low payout ratio that the company is currently reporting.

We Really Like Hancock Whitney's Dividend

Overall, we think this could be an attractive income stock, and it is only getting better by paying a higher dividend this year. The company is generating plenty of cash, and the earnings also quite easily cover the distributions. We should point out that the earnings are expected to fall over the next 12 months, which won't be a problem if this doesn't become a trend, but could cause some turbulence in the next year. 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. Still, investors need to consider a host of other factors, apart from dividend payments, when analysing a company. To that end, Hancock Whitney has 2 warning signs (and 1 which is significant) we think you should know about. Looking for more high-yielding dividend ideas? Try our collection of strong dividend payers.

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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.