Civista Bancshares (NASDAQ:CIVB) Has Affirmed Its Dividend Of $0.15
The board of Civista Bancshares, Inc. (NASDAQ:CIVB) has announced that it will pay a dividend of $0.15 per share on the 24th of May. This payment means that the dividend yield will be 3.8%, which is around the industry average.
While the dividend yield is important for income investors, it is also important to consider any large share price moves, as this will generally outweigh any gains from distributions. Civista Bancshares' stock price has reduced by 35% in the last 3 months, which is not ideal for investors and can explain a sharp increase in the dividend yield.
View our latest analysis for Civista Bancshares
Civista Bancshares' Dividend Forecasted To Be Well Covered By Earnings
Solid dividend yields are great, but they only really help us if the payment is sustainable.
Civista Bancshares has established itself as a dividend paying company with over 10 years history of distributing earnings to shareholders. While past data isn't a guarantee for the future, Civista Bancshares' latest earnings report puts its payout ratio at 20%, showing that the company can pay out its dividends comfortably.
Looking forward, earnings per share is forecast to rise by 1.7% over the next year. If the dividend continues on this path, the future payout ratio could be 24% by next year, which we think can be pretty sustainable going forward.
Civista Bancshares Has A Solid Track Record
The company has an extended history of paying stable dividends. The annual payment during the last 10 years was $0.12 in 2013, and the most recent fiscal year payment was $0.56. This works out to be a compound annual growth rate (CAGR) of approximately 17% a year over that time. It is good to see that there has been strong dividend growth, and that there haven't been any cuts for a long time.
The Dividend Looks Likely To Grow
Investors could be attracted to the stock based on the quality of its payment history. We are encouraged to see that Civista Bancshares has grown earnings per share at 11% per year over the past five years. Civista Bancshares definitely has the potential to grow its dividend in the future with earnings on an uptrend and a low payout ratio.
Civista Bancshares Looks Like A Great Dividend Stock
In summary, it is good to see that the dividend is staying consistent, and we don't think there is any reason to suspect this might change over the medium term. 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. All of these factors considered, we think this has solid potential as a dividend stock.
Companies possessing a stable dividend policy will likely enjoy greater investor interest than those suffering from a more inconsistent approach. Still, investors need to consider a host of other factors, apart from dividend payments, when analysing a company. Taking the debate a bit further, we've identified 1 warning sign for Civista Bancshares that investors need to be conscious of moving forward. Is Civista Bancshares 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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