OceanFirst Financial (NASDAQ:OCFC) Has Announced A Dividend Of $0.20

OceanFirst Financial Corp. (NASDAQ:OCFC) will pay a dividend of $0.20 on the 17th of November. The dividend yield will be 6.3% based on this payment which is still above the industry average.

Check out our latest analysis for OceanFirst Financial

OceanFirst Financial's Dividend Forecasted To Be Well Covered By Earnings

Impressive dividend yields are good, but this doesn't matter much if the payments can't be sustained.

OceanFirst Financial has a long history of paying out dividends, with its current track record at a minimum of 10 years. Taking data from its last earnings report, calculating for the company's payout ratio shows 38%, which means that OceanFirst Financial would be able to pay its last dividend without pressure on the balance sheet.

Looking forward, EPS is forecast to rise by 3.3% over the next 3 years. The future payout ratio could be 41% over that time period, according to analyst estimates, which is a good look for the future of the dividend.

OceanFirst Financial Has A Solid Track Record

The company has been paying a dividend for a long time, and it has been quite stable which gives us confidence in the future dividend potential. The annual payment during the last 10 years was $0.48 in 2013, and the most recent fiscal year payment was $0.80. This implies that the company grew its distributions at a yearly rate of about 5.2% 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. OceanFirst Financial has seen EPS rising for the last five years, at 10% per annum. OceanFirst Financial definitely has the potential to grow its dividend in the future with earnings on an uptrend and a low payout ratio.

OceanFirst Financial Looks Like A Great Dividend Stock

Overall, we like to see the dividend staying consistent, and we think OceanFirst Financial might even raise payments in the future. Earnings are easily covering distributions, and the company is generating plenty of cash. All of these factors considered, we think this has solid potential as a dividend stock.

It's important to note that companies having a consistent dividend policy will generate greater investor confidence than those having an erratic one. Still, investors need to consider a host of other factors, apart from dividend payments, when analysing a company. Earnings growth generally bodes well for the future value of company dividend payments. See if the 6 OceanFirst Financial 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.