Barrett Business Services (NASDAQ:BBSI) Has Affirmed Its Dividend Of $0.30
The board of Barrett Business Services, Inc. (NASDAQ:BBSI) has announced that it will pay a dividend on the 28th of March, with investors receiving $0.30 per share. The dividend yield is 1.0% based on this payment, which is a little bit low compared to the other companies in the industry.
View our latest analysis for Barrett Business Services
Barrett Business Services' Payment Has Solid Earnings Coverage
While yield is important, another factor to consider about a company's dividend is whether the current payout levels are feasible. Before making this announcement, Barrett Business Services was easily earning enough to cover the dividend. This means that most of its earnings are being retained to grow the business.
Over the next year, EPS is forecast to expand by 20.7%. Assuming the dividend continues along recent trends, we think the payout ratio could be 14% by next year, which is in a pretty sustainable range.
Barrett Business Services Has A Solid Track Record
Even over a long history of paying dividends, the company's distributions have been remarkably stable. The dividend has gone from an annual total of $0.52 in 2014 to the most recent total annual payment of $1.20. This implies that the company grew its distributions at a yearly rate of about 8.7% over that duration. The growth of the dividend has been pretty reliable, so we think this can offer investors some nice additional income in their portfolio.
We Could See Barrett Business Services' Dividend Growing
Investors could be attracted to the stock based on the quality of its payment history. We are encouraged to see that Barrett Business Services has grown earnings per share at 8.2% per year over the past five years. With a decent amount of growth and a low payout ratio, we think this bodes well for Barrett Business Services' prospects of growing its dividend payments in the future.
Barrett Business Services Looks Like A Great Dividend Stock
Overall, we like to see the dividend staying consistent, and we think Barrett Business Services might even raise payments in the future. Earnings are easily covering distributions, and the company is generating plenty of cash. All in all, this checks a lot of the boxes we look for when choosing an income stock.
It's important to note that companies having a consistent dividend policy will generate greater investor confidence than those having an erratic one. Still, investors need to consider a host of other factors, apart from dividend payments, when analysing a company. Earnings growth generally bodes well for the future value of company dividend payments. See if the 4 Barrett Business Services analysts we track are forecasting continued growth with our free report on analyst estimates for the company. If you are a dividend investor, you might also want to look at our curated list of high yield 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.
