F.N.B (NYSE:FNB) Has Re-Affirmed Its Dividend Of US$0.12

By
Simply Wall St
Published
October 16, 2021
NYSE:FNB
Source: Shutterstock

F.N.B. Corporation's (NYSE:FNB) investors are due to receive a payment of US$0.12 per share on 15th of December. Based on this payment, the dividend yield on the company's stock will be 4.0%, which is an attractive boost to shareholder returns.

View our latest analysis for F.N.B

F.N.B's Payment Has Solid Earnings Coverage

If the payments aren't sustainable, a high yield for a few years won't matter that much. The last dividend was quite easily covered by F.N.B's earnings. This means that a large portion of its earnings are being retained to grow the business.

Over the next year, EPS is forecast to expand by 3.0%. If the dividend continues on this path, the payout ratio could be 44% by next year, which we think can be pretty sustainable going forward.

historic-dividend
NYSE:FNB Historic Dividend October 17th 2021

F.N.B Has A Solid Track Record

The company has an extended history of paying stable dividends. The most recent annual payment of US$0.48 is about the same as the first annual payment 10 years ago. 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 Has Growth Potential

The company's investors will be pleased to have been receiving dividend income for some time. It's encouraging to see F.N.B has been growing its earnings per share at 7.8% a year over the past five years. Earnings are on the uptrend, and it is only paying a small portion of those earnings to shareholders.

F.N.B Looks Like A Great Dividend Stock

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. Distributions are quite easily covered by earnings, which are also being converted to cash flows. All of these factors considered, we think this has solid potential as a dividend stock.

It's important to note that companies having a consistent dividend policy will generate greater investor confidence than those having an erratic one. At the same time, there are other factors our readers should be conscious of before pouring capital into a stock. Earnings growth generally bodes well for the future value of company dividend payments. See if the 8 F.N.B analysts we track are forecasting continued growth with our free report on analyst estimates for the company. We have also put together a list of global stocks with a solid dividend.

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