How Does Salisbury Bancorp Inc (NASDAQ:SAL) Fare As A Dividend Stock?
Dividends can be underrated but they form a large part of investment returns, playing an important role in compounding returns in the long run. Salisbury Bancorp Inc (NASDAQ:SAL) has returned to shareholders over the past 10 years, an average dividend yield of 4.00% annually. Does Salisbury Bancorp tick all the boxes of a great dividend stock? Below, I’ll take you through my analysis. See our latest analysis for Salisbury Bancorp
Here’s how I find good dividend stocks
If you are a dividend investor, you should always assess these five key metrics:
Is its annual yield among the top 25% of dividend-paying companies?
Has it paid dividend every year without dramatically reducing payout in the past?
Has dividend per share amount increased over the past?
Is it able 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 does Salisbury Bancorp fare?
The current trailing twelve-month payout ratio for the stock is 49.78%, which means that the dividend is covered by earnings. In the near future, analysts are predicting lower payout ratio of 33.14%, leading to a dividend yield of around 2.46%. However, EPS should increase to $3.08, meaning that the lower payout ratio does not necessarily implicate a lower dividend payment. If there is one thing that you want to be reliable in your life, it’s dividend stocks and their constant income stream. SAL investors will be well aware there has not been any increase in the dividend payments over the last 10 years, although the payments have at least been steady. However, income investors that value stability over growth may still find SAL appealing. In terms of its peers, Salisbury Bancorp has a yield of 2.46%, which is on the low-side for Banks stocks.
Next Steps:
Taking into account the dividend metrics, Salisbury Bancorp ticks most of the boxes as a strong dividend investment, putting it in my list of top dividend payers. Given that this is purely a dividend analysis, I recommend taking sufficient time to understand its core business and determine whether the company and its investment properties suit your overall goals. I’ve put together three essential aspects you should further examine:
Future Outlook: What are well-informed industry analysts predicting for SAL’s future growth? Take a look at our free research report of analyst consensus for SAL’s outlook.
Valuation: What is SAL worth today? Even if the stock is a cash cow, it’s not worth an infinite price. The intrinsic value infographic in our free research report helps visualize whether SAL is currently mispriced by the market.
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.
