Trustmark (NASDAQ:TRMK) Is Paying Out A Dividend Of $0.23

Trustmark Corporation (NASDAQ:TRMK) will pay a dividend of $0.23 on the 15th of June. This payment means that the dividend yield will be 3.9%, which is around the industry average.

See our latest analysis for Trustmark

Trustmark's Payment Expected To Have Solid Earnings Coverage

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

Trustmark has established itself as a dividend paying company with over 10 years history of distributing earnings to shareholders. Based on Trustmark's last earnings report, the payout ratio is at a decent 60%, meaning that the company is able to pay out its dividend with a bit of room to spare.

Over the next year, EPS is forecast to expand by 1.3%. If the dividend continues along recent trends, we estimate the future payout ratio will be 60%, which is in the range that makes us comfortable with the sustainability of the dividend.

Trustmark Has A Solid Track Record

Even over a long history of paying dividends, the company's distributions have been remarkably stable. The last annual payment of $0.92 was flat on the annual payment from10 years ago. Slow and steady dividend growth might not sound that exciting, but dividends have been stable for ten years, which we think makes this a fairly attractive offer.

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. Let's not jump to conclusions as things might not be as good as they appear on the surface. Trustmark hasn't seen much change in its earnings per share over the last five years.

In Summary

Overall, a consistent dividend is a good thing, and we think that Trustmark has the ability to continue this into the future. While the payments look sustainable for now, earnings have been shrinking so the dividend could come under pressure in the future. Taking all of this into consideration, the dividend looks viable moving forward, but investors should be mindful that the company has pushed the boundaries of sustainability in the past and may do so again.

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. For example, we've picked out 2 warning signs for Trustmark that investors should know about before committing capital to this stock. Is Trustmark 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.