Monarch Casino & Resort (NASDAQ:MCRI) Has Announced A Dividend Of $0.30

The board of Monarch Casino & Resort, Inc. (NASDAQ:MCRI) has announced that it will pay a dividend on the 15th of June, with investors receiving $0.30 per share. This means the dividend yield will be fairly typical at 1.8%.

View our latest analysis for Monarch Casino & Resort

Monarch Casino & Resort's Earnings Easily Cover The Distributions

While it is always good to see a solid dividend yield, we should also consider whether the payment is feasible. However, prior to this announcement, Monarch Casino & Resort's dividend was comfortably covered by both cash flow and earnings. This means that most of its earnings are being retained to grow the business.

The next year is set to see EPS grow by 6.1%. Assuming the dividend continues along recent trends, we think the payout ratio could be 26% by next year, which is in a pretty sustainable range.

Monarch Casino & Resort Doesn't Have A Long Payment History

The company hasn't been paying a dividend for very long at all, so we can't really make a judgement on how stable the dividend has been. This doesn't mean that the company can't pay a good dividend, but just that we want to wait until it can prove itself.

The Dividend Looks Likely To Grow

Some investors will be chomping at the bit to buy some of the company's stock based on its dividend history. We are encouraged to see that Monarch Casino & Resort has grown earnings per share at 18% per year over the past five years. With a decent amount of growth and a low payout ratio, we think this bodes well for Monarch Casino & Resort's prospects of growing its dividend payments in the future.

We Really Like Monarch Casino & Resort's Dividend

Overall, we like to see the dividend staying consistent, and we think Monarch Casino & Resort 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.

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. For example, we've picked out 1 warning sign for Monarch Casino & Resort that investors should know about before committing capital to this stock. Looking for more high-yielding dividend ideas? Try our collection of strong dividend payers.

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