Be Sure To Check Out Ohio Valley Banc Corp. (NASDAQ:OVBC) Before It Goes Ex-Dividend

Ohio Valley Banc Corp. (NASDAQ:OVBC) is about to trade ex-dividend in the next 4 days. The ex-dividend date is usually set to be one business day before the record date which is the cut-off date on which you must be present on the company's books as a shareholder in order to receive the dividend. It is important to be aware of the ex-dividend date because any trade on the stock needs to have been settled on or before the record date. Accordingly, Ohio Valley Banc investors that purchase the stock on or after the 25th of April will not receive the dividend, which will be paid on the 10th of May.

The company's upcoming dividend is US$0.22 a share, following on from the last 12 months, when the company distributed a total of US$0.88 per share to shareholders. Looking at the last 12 months of distributions, Ohio Valley Banc has a trailing yield of approximately 3.7% on its current stock price of US$23.50. Dividends are an important source of income to many shareholders, but the health of the business is crucial to maintaining those dividends. As a result, readers should always check whether Ohio Valley Banc has been able to grow its dividends, or if the dividend might be cut.

Check out our latest analysis for Ohio Valley Banc

If a company pays out more in dividends than it earned, then the dividend might become unsustainable - hardly an ideal situation. That's why it's good to see Ohio Valley Banc paying out a modest 33% of its earnings.

Companies that pay out less in dividends than they earn in profits generally have more sustainable dividends. The lower the payout ratio, the more wiggle room the business has before it could be forced to cut the dividend.

Click here to see how much of its profit Ohio Valley Banc paid out over the last 12 months.

Have Earnings And Dividends Been Growing?

Companies that aren't growing their earnings can still be valuable, but it is even more important to assess the sustainability of the dividend if it looks like the company will struggle to grow. Investors love dividends, so if earnings fall and the dividend is reduced, expect a stock to be sold off heavily at the same time. It's not encouraging to see that Ohio Valley Banc's earnings are effectively flat over the past five years. Better than seeing them fall off a cliff, for sure, but the best dividend stocks grow their earnings meaningfully over the long run.

Another key way to measure a company's dividend prospects is by measuring its historical rate of dividend growth. It looks like the Ohio Valley Banc dividends are largely the same as they were 10 years ago.

To Sum It Up

Is Ohio Valley Banc an attractive dividend stock, or better left on the shelf? Earnings per share have been flat in recent years, although Ohio Valley Banc reinvests more than half its earnings in the business, which could suggest there are some growth projects that have not yet reached fruition. Overall, Ohio Valley Banc looks like a promising dividend stock in this analysis, and we think it would be worth investigating further.

Curious about whether Ohio Valley Banc has been able to consistently generate growth? Here's a chart of its historical revenue and earnings growth.

If you're in the market for strong dividend payers, we recommend checking 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.