TrustCo Bank Corp NY (NASDAQ:TRST) Looks Interesting, And It's About To Pay A Dividend

By
Simply Wall St
Published
November 26, 2021
NasdaqGS:TRST
Source: Shutterstock

Regular readers will know that we love our dividends at Simply Wall St, which is why it's exciting to see TrustCo Bank Corp NY (NASDAQ:TRST) is about to trade ex-dividend in the next 4 days. The ex-dividend date is one business day before the record date, which is the cut-off date for shareholders to be present on the company's books to be eligible for a dividend payment. It is important to be aware of the ex-dividend date because any trade on the stock needs to have been settled on or before the record date. Accordingly, TrustCo Bank Corp NY investors that purchase the stock on or after the 2nd of December will not receive the dividend, which will be paid on the 3rd of January.

The company's next dividend payment will be US$0.35 per share, on the back of last year when the company paid a total of US$1.36 to shareholders. Based on the last year's worth of payments, TrustCo Bank Corp NY stock has a trailing yield of around 4.3% on the current share price of $32.66. Dividends are a major contributor to investment returns for long term holders, but only if the dividend continues to be paid. So we need to check whether the dividend payments are covered, and if earnings are growing.

See our latest analysis for TrustCo Bank Corp NY

If a company pays out more in dividends than it earned, then the dividend might become unsustainable - hardly an ideal situation. That's why it's good to see TrustCo Bank Corp NY paying out a modest 44% of its earnings.

Generally speaking, the lower a company's payout ratios, the more resilient its dividend usually is.

Click here to see how much of its profit TrustCo Bank Corp NY paid out over the last 12 months.

historic-dividend
NasdaqGS:TRST Historic Dividend November 27th 2021

Have Earnings And Dividends Been Growing?

Businesses with strong growth prospects usually make the best dividend payers, because it's easier to grow dividends when earnings per share are improving. If earnings fall far enough, the company could be forced to cut its dividend. With that in mind, we're encouraged by the steady growth at TrustCo Bank Corp NY, with earnings per share up 6.7% on average over the last five years.

Many investors will assess a company's dividend performance by evaluating how much the dividend payments have changed over time. Since the start of our data, 10 years ago, TrustCo Bank Corp NY has lifted its dividend by approximately 0.6% a year on average.

The Bottom Line

Has TrustCo Bank Corp NY got what it takes to maintain its dividend payments? It has been growing its earnings per share somewhat in recent years, although it reinvests more than half its earnings in the business, which could suggest there are some growth projects that have not yet reached fruition. We think this is a pretty attractive combination, and would be interested in investigating TrustCo Bank Corp NY more closely.

Keen to explore more data on TrustCo Bank Corp NY's financial performance? Check out our visualisation of its historical revenue and earnings growth.

We wouldn't recommend just buying the first dividend stock you see, though. Here's a list of interesting dividend stocks with a greater than 2% yield and an upcoming dividend.

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