BOK Financial (NASDAQ:BOKF) Is Increasing Its Dividend To $0.54
BOK Financial Corporation's (NASDAQ:BOKF) dividend will be increasing from last year's payment of the same period to $0.54 on 25th of November. Despite this raise, the dividend yield of 2.0% is only a modest boost to shareholder returns.
Check out our latest analysis for BOK Financial
BOK Financial's Payment Expected To Have Solid Earnings Coverage
It would be nice for the yield to be higher, but we should also check if higher levels of dividend payment would be sustainable.
Having distributed dividends for at least 10 years, BOK Financial has a long history of paying out a part of its earnings to shareholders. Past distributions do not necessarily guarantee future ones, but BOK Financial's payout ratio of 31% is a good sign as this means that earnings decently cover dividends.
Over the next 3 years, EPS is forecast to expand by 33.7%. Analysts forecast the future payout ratio could be 25% over the same time horizon, which is a number we think the company can maintain.
BOK Financial Has A Solid Track Record
The company has been paying a dividend for a long time, and it has been quite stable which gives us confidence in the future dividend potential. The dividend has gone from an annual total of $1.32 in 2012 to the most recent total annual payment of $2.16. This works out to be a compound annual growth rate (CAGR) of approximately 5.0% a year over that time. Companies like this can be very valuable over the long term, if the decent rate of growth can be maintained.
The Dividend Has Growth Potential
Investors could be attracted to the stock based on the quality of its payment history. It's encouraging to see that BOK Financial has been growing its earnings per share at 7.7% a year over the past five years. BOK Financial definitely has the potential to grow its dividend in the future with earnings on an uptrend and a low payout ratio.
We Really Like BOK Financial's Dividend
Overall, we think this could be an attractive income stock, and it is only getting better by paying a higher dividend this year. Distributions are quite easily covered by earnings, which are also being converted to cash flows. 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. At the same time, there are other factors our readers should be conscious of before pouring capital into a stock. For instance, we've picked out 1 warning sign for BOK Financial that investors should take into consideration. Is BOK Financial 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.
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