MidWestOne Financial Group's (NASDAQ:MOFG) Dividend Will Be $0.2425

MidWestOne Financial Group, Inc. (NASDAQ:MOFG) will pay a dividend of $0.2425 on the 15th of September. This makes the dividend yield 4.6%, which will augment investor returns quite nicely.

View our latest analysis for MidWestOne Financial Group

MidWestOne Financial Group's Dividend Forecasted To Be Well Covered By Earnings

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

MidWestOne Financial Group has a long history of paying out dividends, with its current track record at a minimum of 10 years. Based on MidWestOne Financial Group's last earnings report, the payout ratio is at a decent 35%, meaning that the company is able to pay out its dividend with a bit of room to spare.

EPS is set to fall by 2.3% over the next 12 months. But if the dividend continues along the path it has been on recently, we estimate the future payout ratio could be 38%, which would be comfortable for the company to continue in the future.

MidWestOne Financial Group Has A Solid Track Record

The company has a sustained record of paying dividends with very little fluctuation. The dividend has gone from an annual total of $0.38 in 2013 to the most recent total annual payment of $0.97. This implies that the company grew its distributions at a yearly rate of about 9.8% over that duration. The growth of the dividend has been pretty reliable, so we think this can offer investors some nice additional income in their portfolio.

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. MidWestOne Financial Group has seen EPS rising for the last five years, at 10% per annum. MidWestOne Financial Group definitely has the potential to grow its dividend in the future with earnings on an uptrend and a low payout ratio.

MidWestOne Financial Group Looks Like A Great Dividend Stock

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. 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.

Companies possessing a stable dividend policy will likely enjoy greater investor interest than those suffering from a more inconsistent approach. 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 MidWestOne Financial Group that investors need to be conscious of moving forward. Is MidWestOne Financial Group not quite the opportunity you were looking for? Why not check out our selection of top dividend stocks.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.