Stock Analysis

TriCo Bancshares (NASDAQ:TCBK) Has Announced A Dividend Of $0.33

NasdaqGS:TCBK
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TriCo Bancshares (NASDAQ:TCBK) will pay a dividend of $0.33 on the 21st of June. The payment will take the dividend yield to 3.5%, which is in line with the average for the industry.

View our latest analysis for TriCo Bancshares

TriCo Bancshares' Earnings Will Easily Cover The Distributions

We like to see a healthy dividend yield, but that is only helpful to us if the payment can continue.

Having distributed dividends for at least 10 years, TriCo Bancshares has a long history of paying out a part of its earnings to shareholders. Taking data from its last earnings report, calculating for the company's payout ratio shows 37%, which means that TriCo Bancshares would be able to pay its last dividend without pressure on the balance sheet.

Over the next year, EPS is forecast to expand by 2.2%. Assuming the dividend continues along recent trends, we think the future payout ratio could be 41% by next year, which is in a pretty sustainable range.

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NasdaqGS:TCBK Historic Dividend May 31st 2024

TriCo Bancshares Has A Solid Track Record

Even over a long history of paying dividends, the company's distributions have been remarkably stable. The annual payment during the last 10 years was $0.44 in 2014, and the most recent fiscal year payment was $1.32. This means that it has been growing its distributions at 12% per annum over that time. It is good to see that there has been strong dividend growth, and that there haven't been any cuts for a long time.

TriCo Bancshares May Find It Hard To Grow The Dividend

Some investors will be chomping at the bit to buy some of the company's stock based on its dividend history. Earnings have grown at around 4.0% a year for the past five years, which isn't massive but still better than seeing them shrink. While EPS growth is quite low, TriCo Bancshares has the option to increase the payout ratio to return more cash to shareholders.

TriCo Bancshares Looks Like A Great Dividend Stock

In summary, it is always positive to see the dividend being increased, and we are particularly pleased with its overall sustainability. Earnings are easily covering distributions, and the company is generating plenty of cash. Taking this all into consideration, this looks like it could be a good dividend opportunity.

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. Earnings growth generally bodes well for the future value of company dividend payments. See if the 5 TriCo Bancshares analysts we track are forecasting continued growth with our free report on analyst estimates for the company. Is TriCo Bancshares 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.