LCNB (NASDAQ:LCNB) Will Pay A Dividend Of $0.22

LCNB Corp.'s (NASDAQ:LCNB) investors are due to receive a payment of $0.22 per share on 16th of September. Based on this payment, the dividend yield on the company's stock will be 5.5%, which is an attractive boost to shareholder returns.

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LCNB's Earnings Will Easily Cover The Distributions

A big dividend yield for a few years doesn't mean much if it can't be sustained.

LCNB has established itself as a dividend paying company with over 10 years history of distributing earnings to shareholders. Based on LCNB's last earnings report, the payout ratio is at a decent 59%, meaning that the company is able to pay out its dividend with a bit of room to spare.

The next year is set to see EPS grow by 6.6%. If the dividend continues on this path, the future payout ratio could be 58% by next year, which we think can be pretty sustainable going forward.

View our latest analysis for LCNB

LCNB Has A Solid Track Record

The company has an extended history of paying stable dividends. Since 2015, the dividend has gone from $0.64 total annually to $0.88. This works out to be a compound annual growth rate (CAGR) of approximately 3.2% a year over that time. While the consistency in the dividend payments is impressive, we think the relatively slow rate of growth is less attractive.

Dividend Growth May Be Hard To Achieve

The company's investors will be pleased to have been receiving dividend income for some time. Unfortunately things aren't as good as they seem. LCNB hasn't seen much change in its earnings per share over the last five years.

Our Thoughts On LCNB'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. While the payments look sustainable for now, earnings have been shrinking so the dividend could come under pressure in the future. This looks like it could be a good dividend stock going forward, but we would note that the payout ratio has been at higher levels in the past so it could happen again.

Companies possessing a stable dividend policy will likely enjoy greater investor interest than those suffering from a more inconsistent approach. However, there are other things to consider for investors when analysing stock performance. You can also discover whether shareholders are aligned with insider interests by checking our visualisation of insider shareholdings and trades in LCNB stock. Is LCNB 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.