Southern Missouri Bancorp (NASDAQ:SMBC) Is Paying Out A Dividend Of $0.21

Southern Missouri Bancorp, Inc. (NASDAQ:SMBC) has announced that it will pay a dividend of $0.21 per share on the 31st of May. The dividend yield is 2.0% based on this payment, which is a little bit low compared to the other companies in the industry.

Check out our latest analysis for Southern Missouri Bancorp

Southern Missouri Bancorp's Dividend Forecasted To Be Well Covered By Earnings

It would be nice for the yield to be higher, but we should also check if higher levels of dividend payment would be sustainable.

Southern Missouri Bancorp has a long history of paying out dividends, with its current track record at a minimum of 10 years. While past data isn't a guarantee for the future, Southern Missouri Bancorp's latest earnings report puts its payout ratio at 18%, showing that the company can pay out its dividends comfortably.

Looking forward, earnings per share is forecast to fall by 0.5% over the next year. But if the dividend continues along recent trends, we estimate the future payout ratio could be 20%, which we would consider to be quite comfortable looking forward, with most of the company's earnings left over to grow the business in the future.

Southern Missouri Bancorp Has A Solid Track Record

The company has a sustained record of paying dividends with very little fluctuation. Since 2014, the annual payment back then was $0.32, compared to the most recent full-year payment of $0.84. This implies that the company grew its distributions at a yearly rate of about 10% over that duration. It is good to see that there has been strong dividend growth, and that there haven't been any cuts for a long time.

The Dividend Has Growth Potential

Investors could be attracted to the stock based on the quality of its payment history. Southern Missouri Bancorp has impressed us by growing EPS at 9.1% per year over the past five years. Southern Missouri Bancorp definitely has the potential to grow its dividend in the future with earnings on an uptrend and a low payout ratio.

Southern Missouri Bancorp Looks Like A Great Dividend Stock

Overall, we like to see the dividend staying consistent, and we think Southern Missouri Bancorp might even raise payments in the future. The earnings easily cover the company's distributions, and the company is generating plenty of cash. However, it is worth noting that the earnings are expected to fall over the next year, which may not change the long term outlook, but could affect the dividend payment in the next 12 months. All in all, this checks a lot of the boxes we look for when choosing an income stock.

It's important to note that companies having a consistent dividend policy will generate greater investor confidence than those having an erratic one. At the same time, there are other factors our readers should be conscious of before pouring capital into a stock. Just as an example, we've come across 2 warning signs for Southern Missouri Bancorp you should be aware of, and 1 of them makes us a bit uncomfortable. 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.