First Financial Bankshares (NASDAQ:FFIN) Has Announced A Dividend Of $0.18
First Financial Bankshares, Inc. (NASDAQ:FFIN) will pay a dividend of $0.18 on the 2nd of January. This takes the annual payment to 2.6% of the current stock price, which unfortunately is below what the industry is paying.
See our latest analysis for First Financial Bankshares
First Financial Bankshares' Dividend Forecasted To Be Well Covered By Earnings
While yield is important, another factor to consider about a company's dividend is whether the current payout levels are feasible.
First Financial Bankshares has a long history of paying out dividends, with its current track record at a minimum of 10 years. Based on First Financial Bankshares' last earnings report, the payout ratio is at a decent 47%, meaning that the company is able to pay out its dividend with a bit of room to spare.
The next 3 years are set to see EPS grow by 0.02%. The future payout ratio could be 52% over that time period, according to analyst estimates, which is a good look for the future of the dividend.
First Financial Bankshares Has A Solid Track Record
The company has an extended history of paying stable dividends. Since 2013, the annual payment back then was $0.25, compared to the most recent full-year payment of $0.72. This works out to be a compound annual growth rate (CAGR) of approximately 11% 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.
We Could See First Financial Bankshares' Dividend Growing
Investors who have held shares in the company for the past few years will be happy with the dividend income they have received. First Financial Bankshares has seen EPS rising for the last five years, at 6.2% per annum. Since earnings per share is growing at an acceptable rate, and the payout policy is balanced, we think the company is positioning itself well to grow earnings and dividends in the future.
First Financial Bankshares Looks Like A Great Dividend Stock
In summary, it is always positive to see the dividend being increased, and we are particularly pleased with its overall sustainability. 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 in all, this checks a lot of the boxes we look for when choosing an income stock.
It's important to note that companies having a consistent dividend policy will generate greater investor confidence than those having an erratic one. Meanwhile, despite the importance of dividend payments, they are not the only factors our readers should know when assessing a company. Companies that are growing earnings tend to be the best dividend stocks over the long term. See what the 5 analysts we track are forecasting for First Financial Bankshares for free with public analyst estimates for the company. Is First Financial Bankshares 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.
