Seacoast Banking Corporation of Florida (NASDAQ:SBCF) Is Due To Pay A Dividend Of $0.18

Seacoast Banking Corporation of Florida's (NASDAQ:SBCF) investors are due to receive a payment of $0.18 per share on 30th of September. Based on this payment, the dividend yield will be 2.8%, which is fairly typical for the industry.

Check out our latest analysis for Seacoast Banking Corporation of Florida

Seacoast Banking Corporation of Florida's Earnings Will Easily Cover The Distributions

Solid dividend yields are great, but they only really help us if the payment is sustainable.

Seacoast Banking Corporation of Florida has a short history of paying out dividends, with its current track record at only 3 years. Diving into the company's earnings report, the payout ratio is set at 52%, which is a decent ratio of dividend payout to earnings, and may sustain future dividends if the company stays at its current trend.

Looking forward, earnings per share is forecast to rise by 10.5% over the next year. If the dividend continues along recent trends, we estimate the future payout ratio will be 47%, which is in the range that makes us comfortable with the sustainability of the dividend.

Seacoast Banking Corporation of Florida Is Still Building Its Track Record

The dividend has been pretty stable looking back, but the company hasn't been paying one for very long. This makes it tough to judge how it would fare through a full economic cycle. The dividend has gone from an annual total of $0.52 in 2021 to the most recent total annual payment of $0.72. This means that it has been growing its distributions at 11% per annum over that time. Seacoast Banking Corporation of Florida has been growing its dividend quite rapidly, which is exciting. However, the short payment history makes us question whether this performance will persist across a full market cycle.

The Dividend's Growth Prospects Are Limited

Investors who have held shares in the company for the past few years will be happy with the dividend income they have received. However, initial appearances might be deceiving. It's not great to see that Seacoast Banking Corporation of Florida's earnings per share has fallen at approximately 2.3% per year over the past five years. If earnings continue declining, the company may have to make the difficult choice of reducing the dividend or even stopping it completely - the opposite of dividend growth. It's not all bad news though, as the earnings are predicted to rise over the next 12 months - we would just be a bit cautious until this can turn into a longer term trend.

In Summary

In summary, while it's good to see that the dividend hasn't been cut, we are a bit cautious about Seacoast Banking Corporation of Florida's payments, as there could be some issues with sustaining them into the future. The low payout ratio is a redeeming feature, but generally we are not too happy with the payments Seacoast Banking Corporation of Florida has been making. We don't think Seacoast Banking Corporation of Florida is a great stock to add to your portfolio if income is your focus.

Investors generally tend to favour companies with a consistent, stable dividend policy as opposed to those operating an irregular one. However, there are other things to consider for investors when analysing stock performance. Taking the debate a bit further, we've identified 2 warning signs for Seacoast Banking Corporation of Florida that investors need to be conscious of moving forward. Is Seacoast Banking Corporation of Florida 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.