AmeriServ Financial (NASDAQ:ASRV) Is Due To Pay A Dividend Of $0.03
The board of AmeriServ Financial, Inc. (NASDAQ:ASRV) has announced that it will pay a dividend of $0.03 per share on the 22nd of May. This means the dividend yield will be fairly typical at 4.1%.
See our latest analysis for AmeriServ Financial
AmeriServ Financial's Earnings Will Easily Cover The Distributions
We like a dividend to be consistent over the long term, so checking whether it is sustainable is important.
Having distributed dividends for at least 10 years, AmeriServ Financial has a long history of paying out a part of its earnings to shareholders. Past distributions do not necessarily guarantee future ones, but AmeriServ Financial's payout ratio of 31% is a good sign as this means that earnings decently cover dividends.
Over the next year, EPS could expand by 13.5% if recent trends continue. If the dividend continues on this path, the future payout ratio could be 31% by next year, which we think can be pretty sustainable going forward.
AmeriServ Financial Has A Solid Track Record
The company has an extended history of paying stable dividends. Since 2013, the dividend has gone from $0.04 total annually to $0.12. This implies that the company grew its distributions at a yearly rate of about 12% over that duration. It is good to see that there has been strong dividend growth, and that there haven't been any cuts for a long time.
The Dividend Looks Likely To Grow
The company's investors will be pleased to have been receiving dividend income for some time. AmeriServ Financial has seen EPS rising for the last five years, at 13% per annum. A low payout ratio and decent growth suggests that the company is reinvesting well, and it also has plenty of room to increase the dividend over time.
AmeriServ Financial Looks Like A Great Dividend Stock
Overall, we think that this is a great income investment, and we think that maintaining the dividend this year may have been a conservative choice. 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. 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. At the same time, there are other factors our readers should be conscious of before pouring capital into a stock. Taking the debate a bit further, we've identified 1 warning sign for AmeriServ Financial that investors need to be conscious of moving forward. Is AmeriServ Financial not quite the opportunity you were looking for? Why not check out our selection of top dividend stocks.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.
Join A Paid User Research Session
You’ll receive a US$30 Amazon Gift card for 1 hour of your time while helping us build better investing tools for the individual investors like yourself. Sign up here
