BancFirst (NASDAQ:BANF) Is Due To Pay A Dividend Of $0.43
BancFirst Corporation's (NASDAQ:BANF) investors are due to receive a payment of $0.43 per share on 15th of April. Although the dividend is now higher, the yield is only 2.0%, which is below the industry average.
Check out our latest analysis for BancFirst
BancFirst's Earnings Will Easily Cover The Distributions
It would be nice for the yield to be higher, but we should also check if higher levels of dividend payment would be sustainable.
BancFirst has established itself as a dividend paying company with over 10 years history of distributing earnings to shareholders. Past distributions do not necessarily guarantee future ones, but BancFirst's payout ratio of 26% is a good sign as this means that earnings decently cover dividends.
Over the next 3 years, EPS is forecast to fall by 28.0%. Fortunately, analysts forecast the future payout ratio to be 35% over the same time horizon, which is in the range that makes us comfortable with the sustainability of the dividend.
BancFirst Has A Solid Track Record
Even over a long history of paying dividends, the company's distributions have been remarkably stable. Since 2014, the annual payment back then was $0.58, compared to the most recent full-year payment of $1.72. This implies that the company grew its distributions at a yearly rate of about 11% over that duration. Rapidly growing dividends for a long time is a very valuable feature for an income stock.
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. It's encouraging to see that BancFirst has been growing its earnings per share at 11% a year over the past five years. With a decent amount of growth and a low payout ratio, we think this bodes well for BancFirst's prospects of growing its dividend payments in the future.
We Really Like BancFirst's Dividend
In summary, it is always positive to see the dividend being increased, and we are particularly pleased with its overall sustainability. The earnings easily cover the company's distributions, and the company is generating plenty of cash. However, it is worth noting that the earnings are expected to fall over the next year, which may not change the long term outlook, but could affect the dividend payment in the next 12 months. Taking this all into consideration, this looks like it could be a good dividend opportunity.
It's important to note that companies having a consistent dividend policy will generate greater investor confidence than those having an erratic one. However, there are other things to consider for investors when analysing stock performance. For example, we've identified 2 warning signs for BancFirst (1 is a bit unpleasant!) that you should be aware of before investing. Is BancFirst not quite the opportunity you were looking for? Why not check out our selection of top dividend stocks.
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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.
