The board of F.N.B. Corporation (NYSE:FNB) has announced that it will pay a dividend on the 15th of June, with investors receiving $0.12 per share. This means the dividend yield will be fairly typical at 3.4%.
View our latest analysis for F.N.B
F.N.B's Dividend Forecasted To Be Well Covered By Earnings
We aren't too impressed by dividend yields unless they can be sustained over time.
Having distributed dividends for at least 10 years, F.N.B has a long history of paying out a part of its earnings to shareholders. Past distributions do not necessarily guarantee future ones, but F.N.B's payout ratio of 39% is a good sign as this means that earnings decently cover dividends.
The next year is set to see EPS grow by 12.2%. If the dividend continues on this path, the future payout ratio could be 34% by next year, which we think can be pretty sustainable going forward.
F.N.B Has A Solid Track Record
The company has a sustained record of paying dividends with very little fluctuation. There hasn't been much of a change in the dividend over the last 10 years. Dividends have grown relatively slowly, which is not great, but some investors may value the relative consistency of the dividend.
The Dividend's Growth Prospects Are Limited
Investors who have held shares in the company for the past few years will be happy with the dividend income they have received. Unfortunately, F.N.B's earnings per share has been essentially flat over the past five years, which means the dividend may not be increased each year. While growth may be thin on the ground, F.N.B could always pay out a higher proportion of earnings to increase shareholder returns.
We Really Like F.N.B's Dividend
In summary, it is good to see that the dividend is staying consistent, and we don't think there is any reason to suspect this might change over the medium term. 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.
Investors generally tend to favour companies with a consistent, stable dividend policy as opposed to those operating an irregular one. 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 9 F.N.B analysts we track are forecasting continued growth with our free report on analyst estimates for the company. Is F.N.B not quite the opportunity you were looking for? Why not check out our selection of top 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.
About NYSE:FNB
F.N.B
A bank and financial holding company, provides a range of financial products and services primarily to consumers, corporations, governments, and small- to medium-sized businesses in the United States.
Flawless balance sheet average dividend payer.
