Pathfinder Bancorp (NASDAQ:PBHC) Will Pay A Dividend Of $0.09

The board of Pathfinder Bancorp, Inc. (NASDAQ:PBHC) has announced that it will pay a dividend on the 19th of May, with investors receiving $0.09 per share. This means the annual payment will be 2.2% of the current stock price, which is lower than the industry average.

View our latest analysis for Pathfinder Bancorp

Pathfinder Bancorp's Earnings Will Easily Cover The Distributions

While yield is important, another factor to consider about a company's dividend is whether the current payout levels are feasible.

Pathfinder Bancorp has a long history of paying out dividends, with its current track record at a minimum of 10 years. Using data from its latest earnings report, Pathfinder Bancorp's payout ratio sits at 20%, an extremely comfortable number that shows that it can pay its dividend.

Over the next year, EPS could expand by 14.4% if recent trends continue. If the dividend continues on this path, the future payout ratio could be 20% by next year, which we think can be pretty sustainable going forward.

Pathfinder Bancorp Has A Solid Track Record

The company has an extended history of paying stable dividends. The dividend has gone from an annual total of $0.0729 in 2013 to the most recent total annual payment of $0.36. This means that it has been growing its distributions at 17% per annum over that time. Rapidly growing dividends for a long time is a very valuable feature for an income stock.

The Dividend Looks Likely To Grow

Investors who have held shares in the company for the past few years will be happy with the dividend income they have received. It's encouraging to see that Pathfinder Bancorp has been growing its earnings per share at 14% a year over the past five years. With a decent amount of growth and a low payout ratio, we think this bodes well for Pathfinder Bancorp's prospects of growing its dividend payments in the future.

Pathfinder Bancorp Looks Like A Great Dividend Stock

Overall, we think that this is a great income investment, and we think that maintaining the dividend this year may have been a conservative choice. The company is easily earning enough to cover its dividend payments and it is great to see that these earnings are being translated into cash flow. All in all, this checks a lot of the boxes we look for when choosing an income stock.

Companies possessing a stable dividend policy will likely enjoy greater investor interest than those suffering from a more inconsistent approach. Meanwhile, despite the importance of dividend payments, they are not the only factors our readers should know when assessing a company. As an example, we've identified 1 warning sign for Pathfinder Bancorp that you should be aware of before investing. 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.