City Holding (CHCO) Hikes Dividend by 10%: What You Should Know
City Holding Company CHCO announced a quarterly cash dividend of 71.5 cents per share, indicating an increase of 10% from the prior payout. The dividend will be paid out on Oct 31 to shareholders of record as of Oct 13.
Prior to the recent hike, it increased its dividend by 8.3% in September 2022. CHCO raised its quarterly dividend five times in the last five years. Also, it has a five-year annualized dividend growth of 5.2%. Currently, the company's payout ratio is 32% of earnings.
Charles Hageboeck, president and CEO of City Holding, stated, "The company's current strong capital and liquidity position, our financial performance during 2023, and our confidence in the company's ability to sustain this performance led to the decision to increase the dividend to $2.86 on an annualized basis."
Apart from the regular dividend payments, City Holding has a share repurchase program in place. In May 2022, the board announced a new buyback program, under which, it is authorized to repurchase up to 1 million shares. The plan had nearly 329,307 shares remaining under the repurchase authorization as of Jun 30, 2023.
City Holding’s past performance depicts a robust earnings picture. Its earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, with an average surprise of 10.8%. Over the last three to five years, CHCO’s earnings witnessed growth of 7%. The upward momentum is expected to continue in the near term. In 2023, the company’s earnings are projected to grow 11.5%.
As of Jun 30, 2023, City Holding had a total long-term debt of $100 million, which was significantly lower than the cash and cash equivalent balance of $231.3 million. Also, its debt/equity ratio of 0.16 compares favorably with the industry average of 0.30, thereby reflecting its relatively strong financial health.
Given the earnings strength and strong capital position, the company is expected to continue with efficient capital distribution activities. Through this, City Holding will keep enhancing shareholder value.
Other Companies Taking Similar Steps
Capital City Bank Group Inc. CCBG has followed through with its previous dividend hike plans and raised its quarterly cash dividends by 11.1%. The company paid out a dividend of 20 cents per share on Sep 25 to shareholders of record as of Sep 11.
Prior to the recent hike, it had increased its dividend by 5.9% in February 2023. CCBG raised its quarterly dividend eight times in the last five years. Also, it has a five-year annualized dividend growth of 13.8%. Currently, the company's payout ratio is 23% of earnings.
Summit Financial Group, Inc. SMMF announced a quarterly cash dividend of 22 cents per share, marking an increase of 10% from the prior payout. The dividend was paid out on Sep 29 to shareholders of record on Sep 15.
Prior to this hike, the company increased its dividend by 11.1% in August 2022. SMMF has raised its quarterly dividend six times in the last five years. Also, it has a five-year annualized dividend growth of 8.68%. Currently, its payout ratio is 21% of earnings.
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Capital City Bank Group (CCBG) : Free Stock Analysis Report
City Holding Company (CHCO) : Free Stock Analysis Report
Summit Financial Group, Inc. (SMMF) : Free Stock Analysis Report
