Amerant Bancorp's (NYSE:AMTB) Dividend Will Be $0.09

The board of Amerant Bancorp Inc. (NYSE:AMTB) has announced that it will pay a dividend on the 30th of November, with investors receiving $0.09 per share. This means the annual payment will be 2.1% of the current stock price, which is lower than the industry average.

Check out our latest analysis for Amerant Bancorp

Amerant Bancorp's Earnings Will Easily Cover The Distributions

It would be nice for the yield to be higher, but we should also check if higher levels of dividend payment would be sustainable.

Amerant Bancorp has a short history of paying out dividends, with its current track record at only 2 years. While it has a shorter history of paying out dividends, Amerant Bancorp's payout ratio of 18% is a great sign for current shareholders, as this means that earnings greatly cover dividends.

Looking forward, EPS is forecast to rise by 19.0% over the next 3 years. Analysts estimate the future payout ratio will be 17% over the same time period, which is in the range that makes us comfortable with the sustainability of the dividend.

Amerant Bancorp Doesn't Have A Long Payment History

The company has maintained a consistent dividend for a few years now, but we would like to see a longer track record before relying on it. Since 2021, the annual payment back then was $0.24, compared to the most recent full-year payment of $0.36. This means that it has been growing its distributions at 22% per annum over that time. We're not overly excited about the relatively short history of dividend payments, however the dividend is growing at a nice rate and we might take a closer look.

The Dividend Looks Likely To Grow

Investors who have held shares in the company for the past few years will be happy with the dividend income they have received. Amerant Bancorp has seen EPS rising for the last five years, at 13% per annum. Amerant Bancorp definitely has the potential to grow its dividend in the future with earnings on an uptrend and a low payout ratio.

Amerant Bancorp Looks Like A Great Dividend Stock

Overall, we like to see the dividend staying consistent, and we think Amerant Bancorp 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. 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. Meanwhile, despite the importance of dividend payments, they are not the only factors our readers should know when assessing a company. Taking the debate a bit further, we've identified 2 warning signs for Amerant Bancorp that investors need to be conscious of moving forward. If you are a dividend investor, you might also want to look at our curated list of high yield 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.