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

Seacoast Banking Corporation of Florida (NASDAQ:SBCF) has announced that it will pay a dividend of $0.18 per share on the 30th of June. This payment means that the dividend yield will be 3.0%, which is around the industry average.

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Seacoast Banking Corporation of Florida's Payment Expected To Have Solid Earnings Coverage

Unless the payments are sustainable, the dividend yield doesn't mean too much.

Seacoast Banking Corporation of Florida has a short history of paying out dividends, with its current track record at only 4 years. Based on Seacoast Banking Corporation of Florida's last earnings report, calculating for its payout ratio equates to 50%, which means that the company covered its last dividend with comfortable room to spare.

Over the next 3 years, EPS is forecast to expand by 60.3%. The future payout ratio could be 38% over that time period, according to analyst estimates, which is a good look for the future of the dividend.

See our latest analysis for Seacoast Banking Corporation of Florida

Seacoast Banking Corporation of Florida Is Still Building Its Track Record

Looking back, the dividend has been stable, but the company hasn't been paying a dividend for very long so we can't be confident that the dividend will remain stable through all economic environments. The dividend has gone from an annual total of $0.52 in 2021 to the most recent total annual payment of $0.72. This implies that the company grew its distributions at a yearly rate of about 8.5% over that duration. The dividend has been growing as a reasonable rate, which we like. However, investors will probably want to see a longer track record before they consider Seacoast Banking Corporation of Florida to be a consistent dividend paying stock.

Dividend Growth May Be Hard To Come By

Investors who have held shares in the company for the past few years will be happy with the dividend income they have received. However, things aren't all that rosy. Seacoast Banking Corporation of Florida has seen earnings per share falling at 5.7% per year over the last five years. If the company is making less over time, it naturally follows that it will also have to pay out less in dividends. Earnings are forecast to grow over the next 12 months and if that happens we could still be a little bit cautious until it becomes a pattern.

In Summary

Overall, it's nice to see a consistent dividend payment, but we think that longer term, the current level of payment might be unsustainable. The company hasn't been paying a very consistent dividend over time, despite only paying out a small portion of earnings. Overall, we don't think this company has the makings of a good income stock.

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. Without at least some growth in earnings per share over time, the dividend will eventually come under pressure either from competition or inflation. Businesses can change though, and we think it would make sense to see what analysts are forecasting 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.