First Commonwealth Financial's (NYSE:FCF) Dividend Will Be Increased To $0.135

First Commonwealth Financial Corporation's (NYSE:FCF) dividend will be increasing from last year's payment of the same period to $0.135 on 23rd of May. Based on this payment, the dividend yield for the company will be 3.4%, which is fairly typical for the industry.

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First Commonwealth Financial's Earnings Will Easily Cover The Distributions

We aren't too impressed by dividend yields unless they can be sustained over time.

First Commonwealth Financial 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 39%, which means that First Commonwealth Financial would be able to pay its last dividend without pressure on the balance sheet.

Over the next year, EPS is forecast to expand by 11.3%. If the dividend continues on this path, the future payout ratio could be 37% by next year, which we think can be pretty sustainable going forward.

View our latest analysis for First Commonwealth Financial

First Commonwealth Financial Has A Solid Track Record

Even over a long history of paying dividends, the company's distributions have been remarkably stable. Since 2015, the dividend has gone from $0.28 total annually to $0.54. This works out to be a compound annual growth rate (CAGR) of approximately 6.8% a year over that time. The dividend has been growing very nicely for a number of years, and has given its shareholders some nice income in their portfolios.

The Dividend Has Growth Potential

Investors who have held shares in the company for the past few years will be happy with the dividend income they have received. First Commonwealth Financial has impressed us by growing EPS at 9.3% per year over the past five years. With a decent amount of growth and a low payout ratio, we think this bodes well for First Commonwealth Financial's prospects of growing its dividend payments in the future.

We Really Like First Commonwealth Financial's Dividend

Overall, a dividend increase is always good, and we think that First Commonwealth Financial is a strong income stock thanks to its track record and growing earnings. Distributions are quite easily covered by earnings, which are also being converted to cash flows. Taking this all into consideration, this looks like it could be a good dividend opportunity.

Investors generally tend to favour companies with a consistent, stable dividend policy as opposed to those operating an irregular one. At the same time, there are other factors our readers should be conscious of before pouring capital into a stock. Companies that are growing earnings tend to be the best dividend stocks over the long term. See what the 7 analysts we track are forecasting for First Commonwealth Financial for free with public analyst estimates for the company. Looking for more high-yielding dividend ideas? Try our collection of strong dividend payers.

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