Timberland Bancorp's (NASDAQ:TSBK) Dividend Will Be $0.24

The board of Timberland Bancorp, Inc. (NASDAQ:TSBK) has announced that it will pay a dividend of $0.24 per share on the 23rd of August. This payment means that the dividend yield will be 3.0%, which is around the industry average.

View our latest analysis for Timberland Bancorp

Timberland Bancorp's Dividend Forecasted To Be Well Covered By Earnings

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

Timberland Bancorp has a long history of paying out dividends, with its current track record at a minimum of 10 years. Taking data from its last earnings report, calculating for the company's payout ratio shows 31%, which means that Timberland Bancorp would be able to pay its last dividend without pressure on the balance sheet.

If the trend of the last few years continues, EPS will grow by 2.4% over the next 12 months. If the dividend continues along recent trends, we estimate the future payout ratio will be 35%, which is in the range that makes us comfortable with the sustainability of the dividend.

Timberland Bancorp Has A Solid Track Record

The company has an extended history of paying stable dividends. Since 2014, the dividend has gone from $0.12 total annually to $0.96. This means that it has been growing its distributions at 23% 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.

Dividend Growth May Be Hard To Achieve

Investors could be attracted to the stock based on the quality of its payment history. Earnings per share has been crawling upwards at 2.4% per year. While EPS growth is quite low, Timberland Bancorp has the option to increase the payout ratio to return more cash to shareholders.

We Really Like Timberland Bancorp's Dividend

Overall, we like to see the dividend staying consistent, and we think Timberland Bancorp might even raise payments in the future. Earnings are easily covering distributions, and the company is generating plenty of cash. All of these factors considered, we think this has solid potential as a dividend stock.

Companies possessing a stable dividend policy will likely enjoy greater investor interest than those suffering from a more inconsistent approach. However, there are other things to consider for investors when analysing stock performance. Are management backing themselves to deliver performance? Check their shareholdings in Timberland Bancorp in our latest insider ownership analysis. Looking for more high-yielding dividend ideas? Try our collection of strong dividend payers.

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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.

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