Westamerica Bancorporation's (NASDAQ:WABC) Dividend Will Be $0.42

The board of Westamerica Bancorporation (NASDAQ:WABC) has announced that it will pay a dividend on the 17th of February, with investors receiving $0.42 per share. This payment means that the dividend yield will be 3.0%, which is around the industry average.

Check out our latest analysis for Westamerica Bancorporation

Westamerica Bancorporation's Payment Expected To Have Solid Earnings Coverage

While it is always good to see a solid dividend yield, we should also consider whether the payment is feasible.

Westamerica Bancorporation 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 37%, which means that Westamerica Bancorporation would be able to pay its last dividend without pressure on the balance sheet.

Over the next 3 years, EPS is forecast to expand by 28.3%. The future payout ratio could be 31% over that time period, according to analyst estimates, which is a good look for the future of the dividend.

Westamerica Bancorporation Has A Solid Track Record

The company has a sustained record of paying dividends with very little fluctuation. Since 2013, the dividend has gone from $1.48 total annually to $1.68. This implies that the company grew its distributions at a yearly rate of about 1.3% over that duration. 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 Looks Likely To Grow

The company's investors will be pleased to have been receiving dividend income for some time. We are encouraged to see that Westamerica Bancorporation has grown earnings per share at 19% per year over the past five years. A low payout ratio and decent growth suggests that the company is reinvesting well, and it also has plenty of room to increase the dividend over time.

We Really Like Westamerica Bancorporation's Dividend

Overall, we like to see the dividend staying consistent, and we think Westamerica Bancorporation might even raise payments in the future. The company is easily earning enough to cover its dividend payments and it is great to see that these earnings are being translated into cash flow. Taking this all into consideration, this looks like it could be a good dividend opportunity.

Market movements attest to how highly valued a consistent dividend policy is compared to one which is more unpredictable. Meanwhile, despite the importance of dividend payments, they are not the only factors our readers should know when assessing a company. Earnings growth generally bodes well for the future value of company dividend payments. See if the 3 Westamerica Bancorporation analysts we track are forecasting continued growth with our free report on analyst estimates for the company. Is Westamerica Bancorporation not quite the opportunity you were looking for? Why not check out our selection of top dividend stocks.

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