Capital Bancorp (NASDAQ:CBNK) Has Announced A Dividend Of $0.06
Capital Bancorp, Inc. (NASDAQ:CBNK) will pay a dividend of $0.06 on the 23rd of November. This means the annual payment will be 1.0% of the current stock price, which is lower than the industry average.
See our latest analysis for Capital Bancorp
Capital Bancorp's Earnings Will Easily Cover The Distributions
The dividend yield is a little bit low, but sustainability of the payments is also an important part of evaluating an income stock.
Looking at its history, Capital Bancorp does not yet have a history of paying out dividends, with this year being its first year of distribution. Based on Capital Bancorp's last earnings report however, the payout ratio is at a comfortable 1.6%, meaning that the company may be able to sustain this dividend for future years if it continues on this earnings trend.
The next 3 years are set to see EPS grow by 4.5%. The future payout ratio could be 7.2% over that time period, according to analyst estimates, which is a good look for the future of the dividend.
Capital Bancorp Is Still Building Its Track Record
The company hasn't been paying a dividend for very long at all, so we can't really make a judgement on how stable the dividend has been. This doesn't mean that the company can't pay a good dividend, but just that we want to wait until it can prove itself.
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. We are encouraged to see that Capital Bancorp has grown earnings per share at 37% per year over the past five years. Rapid earnings growth and a low payout ratio suggest this company has been effectively reinvesting in its business. Should that continue, this company could have a bright future.
Capital Bancorp Looks Like A Great Dividend Stock
Overall, we like to see the dividend staying consistent, and we think Capital Bancorp might even raise payments in the future. The company is easily earning enough to cover its dividend payments and it is great to see that these earnings are being translated into cash flow. Taking this all into consideration, this looks like it could be a good dividend opportunity.
Investors generally tend to favour companies with a consistent, stable dividend policy as opposed to those operating an irregular one. At the same time, there are other factors our readers should be conscious of before pouring capital into a stock. Earnings growth generally bodes well for the future value of company dividend payments. See if the 4 Capital Bancorp 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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.
Join A Paid User Research Session
You’ll receive a US$30 Amazon Gift card for 1 hour of your time while helping us build better investing tools for the individual investors like yourself. Sign up here
