If you are interested in cashing in on Northfield Bancorp Inc (Staten Island NY)’s (NASDAQ:NFBK) upcoming dividend of US$0.10 per share, you only have 4 days left to buy the shares before its ex-dividend date, 06 November 2018, in time for dividends payable on the 21 November 2018. Is this future income a persuasive enough catalyst for investors to think about Northfield Bancorp (Staten Island NY) as an investment today? Below, I’m going to look at the latest data and analyze the stock and its dividend property in further detail.
Here’s how I find good dividend stocks
When assessing a stock as a potential addition to my dividend Portfolio, I look at these five areas:
- Is it the top 25% annual dividend yield payer?
- Has its dividend been stable over the past (i.e. no missed payments or significant payout cuts)?
- Has dividend per share risen in the past couple of years?
- Can it afford to pay the current rate of dividends from its earnings?
- Will the company be able to keep paying dividend based on the future earnings growth?
How does Northfield Bancorp (Staten Island NY) fare?
The company currently pays out 65% of its earnings as a dividend, according to its trailing twelve-month data, meaning the dividend is sufficiently covered by earnings. In the near future, analysts are predicting lower payout ratio of 49%, leading to a dividend yield of 3.1%. However, EPS should increase to $0.83, meaning that the lower payout ratio does not necessarily implicate a lower dividend payment.
When thinking about whether a dividend is sustainable, another factor to consider is the cash flow. A company with strong cash flow, relative to earnings, can sometimes sustain a high pay out ratio.
Reliablity is an important factor for dividend stocks, particularly for income investors who want a strong track record of payment and a positive outlook for future payout. NFBK has increased its DPS from $0.11 to $0.40 in the past 10 years. It has also been paying out dividend consistently during this time, as you’d expect for a company increasing its dividend levels. This is an impressive feat, which makes NFBK a true dividend rockstar.
Relative to peers, Northfield Bancorp (Staten Island NY) has a yield of 3.0%, which is on the low-side for Mortgage stocks.
Considering the dividend attributes we analyzed above, Northfield Bancorp (Staten Island NY) is definitely worth keeping an eye on for someone looking to build a dedicated income portfolio. Given that this is purely a dividend analysis, you should always research extensively before deciding whether or not a stock is an appropriate investment for you. I always recommend analysing the company’s fundamentals and underlying business before making an investment decision. I’ve put together three essential factors you should further examine:
- Future Outlook: What are well-informed industry analysts predicting for NFBK’s future growth? Take a look at our free research report of analyst consensus for NFBK’s outlook.
- Valuation: What is NFBK worth today? Even if the stock is a cash cow, it’s not worth an infinite price. The intrinsic value infographic in our free research report helps visualize whether NFBK is currently mispriced by the market.
- Other Dividend Rockstars: Are there better dividend payers with stronger fundamentals out there? Check out our free list of these great stocks here.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at firstname.lastname@example.org.