It looks like Atlantic Union Bankshares Corporation (NASDAQ:AUB) is about to go ex-dividend in the next 4 days. This means that investors who purchase shares on or after the 19th of May will not receive the dividend, which will be paid on the 3rd of June.
Atlantic Union Bankshares's next dividend payment will be US$0.25 per share, on the back of last year when the company paid a total of US$1.00 to shareholders. Calculating the last year's worth of payments shows that Atlantic Union Bankshares has a trailing yield of 5.0% on the current share price of $19.86. We love seeing companies pay a dividend, but it's also important to be sure that laying the golden eggs isn't going to kill our golden goose! As a result, readers should always check whether Atlantic Union Bankshares has been able to grow its dividends, or if the dividend might be cut.
If a company pays out more in dividends than it earned, then the dividend might become unsustainable - hardly an ideal situation. That's why it's good to see Atlantic Union Bankshares paying out a modest 48% of its earnings.
Companies that pay out less in dividends than they earn in profits generally have more sustainable dividends. The lower the payout ratio, the more wiggle room the business has before it could be forced to cut the dividend.
Have Earnings And Dividends Been Growing?
Businesses with strong growth prospects usually make the best dividend payers, because it's easier to grow dividends when earnings per share are improving. If business enters a downturn and the dividend is cut, the company could see its value fall precipitously. For this reason, we're glad to see Atlantic Union Bankshares's earnings per share have risen 12% per annum over the last five years.
Another key way to measure a company's dividend prospects is by measuring its historical rate of dividend growth. Atlantic Union Bankshares has delivered 15% dividend growth per year on average over the past ten years. It's exciting to see that both earnings and dividends per share have grown rapidly over the past few years.
Is Atlantic Union Bankshares worth buying for its dividend? Companies like Atlantic Union Bankshares that are growing rapidly and paying out a low fraction of earnings, are usually reinvesting heavily in their business. This strategy can add significant value to shareholders over the long term - as long as it's done without issuing too many new shares. Overall, Atlantic Union Bankshares looks like a promising dividend stock in this analysis, and we think it would be worth investigating further.
In light of that, while Atlantic Union Bankshares has an appealing dividend, it's worth knowing the risks involved with this stock. For example, we've found 1 warning sign for Atlantic Union Bankshares that we recommend you consider before investing in the business.
If you're in the market for dividend stocks, we recommend checking our list of top dividend stocks with a greater than 2% yield and an upcoming dividend.
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.