On the 13 July 2018, Washington Trust Bancorp Inc (NASDAQ:WASH) will be paying shareholders an upcoming dividend amount of US$0.43 per share. However, investors must have bought the company’s stock before 29 June 2018 in order to qualify for the payment. That means you have only 2 days left! Investors looking for higher income-generating stocks to add to their portfolio should keep reading, as I examine Washington Trust Bancorp’s latest financial data to analyse its dividend characteristics. Check out our latest analysis for Washington Trust Bancorp
5 questions to ask before buying a dividend stock
When researching a dividend stock, I always follow the following screening criteria:
- Is it paying an annual yield above 75% of dividend payers?
- Has it paid dividend every year without dramatically reducing payout in the past?
- Has the amount of dividend per share grown over the past?
- Can it afford to pay the current rate of dividends from its earnings?
- Will the company be able to keep paying dividend based on the future earnings growth?
How well does Washington Trust Bancorp fit our criteria?
The company currently pays out 54.50% of its earnings as a dividend, according to its trailing twelve-month data, which means that the dividend is covered by earnings. Furthermore, analysts have not forecasted a dividends per share for the future, which makes it hard to determine the yield shareholders should expect, and whether the current payout is sustainable, moving forward.
If dividend is a key criteria in your investment consideration, then you need to make sure the dividend stock you’re eyeing out is reliable in its payments. In the case of WASH it has increased its DPS from $0.84 to $1.72 in the past 10 years. During this period it has not missed a payment, as one would expect for a company increasing its dividend. This is an impressive feat, which makes WASH a true dividend rockstar.
Compared to its peers, Washington Trust Bancorp has a yield of 2.81%, which is on the low-side for Banks stocks.
Keeping in mind the dividend characteristics above, Washington Trust Bancorp is definitely worth considering for investors looking to build a dedicated income portfolio. Given that this is purely a dividend analysis, I urge potential investors to try and get a good understanding of the underlying business and its fundamentals before deciding on an investment. Below, I’ve compiled three important aspects you should further research:
- Future Outlook: What are well-informed industry analysts predicting for WASH’s future growth? Take a look at our free research report of analyst consensus for WASH’s outlook.
- Historical Performance: What has WASH’s returns been like over the past? Go into more detail in the past track record analysis and take a look at the free visual representations of our analysis for more clarity.
- Other Dividend Rockstars: Are there better dividend payers with stronger fundamentals out there? Check out our free list of these great stocks here.
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned.