First Hawaiian Inc's Dividend Analysis
Understanding the Dividend Profile of First Hawaiian Inc
First Hawaiian Inc (NASDAQ:FHB) recently announced a dividend of $0.26 per share, payable on 2023-12-01, with the ex-dividend date set for 2023-11-17. As investors look forward to this upcoming payment, the spotlight also shines on the company's dividend history, yield, and growth rates. Using the data from GuruFocus, let's look into First Hawaiian Inc's dividend performance and assess its sustainability.
What Does First Hawaiian Inc Do?
This Powerful Chart Made Peter Lynch 29% A Year For 13 Years
How to calculate the intrinsic value of a stock?
First Hawaiian Inc is a bank holding company. It provides a diversified range of banking services to consumer and commercial customers, including deposit products, lending services, and wealth management and trust services. The company offers a variety of deposit products to its customers, including checking and savings accounts and other types of deposit accounts. It provides commercial and industrial lending, including auto dealer flooring, commercial real estate and construction lending. It also offers comprehensive consumer lending services focused on residential real estate lending, indirect auto financing and other consumer loans. Its segments are Retail Banking, Commercial Banking and Treasury and Other of which key revenue is derived from Retail Banking.
A Glimpse at First Hawaiian Inc's Dividend History
First Hawaiian Inc has maintained a consistent dividend payment record since 2016. Dividends are currently distributed on a quarterly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down First Hawaiian Inc's Dividend Yield and Growth
As of today, First Hawaiian Inc currently has a 12-month trailing dividend yield of 5.35% and a 12-month forward dividend yield of 5.35%. This suggests an expectation of same dividend payments over the next 12 months. Extended to a five-year horizon, this rate increased to 5.70% per year. Based on First Hawaiian Inc's dividend yield and five-year growth rate, the 5-year yield on cost of First Hawaiian Inc stock as of today is approximately 7.06%.
The Sustainability Question: Payout Ratio and Profitability
To assess the sustainability of the dividend, one needs to evaluate the company's payout ratio. The dividend payout ratio provides insights into the portion of earnings the company distributes as dividends. A lower ratio suggests that the company retains a significant part of its earnings, thereby ensuring the availability of funds for future growth and unexpected downturns. As of 2023-09-30, First Hawaiian Inc's dividend payout ratio is 0.50.
First Hawaiian Inc's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks First Hawaiian Inc's profitability 5 out of 10 as of 2023-09-30, suggesting fair profitability. The company has reported net profit in 9 years out of past 10 years.
Growth Metrics: The Future Outlook
To ensure the sustainability of dividends, a company must have robust growth metrics. First Hawaiian Inc's growth rank of 5 out of 10 suggests that the company has a fair growth outlook.
Revenue is the lifeblood of any company, and First Hawaiian Inc's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. First Hawaiian Inc's revenue has increased by approximately 2.60% per year on average, a rate that underperforms than approximately 72.41% of global competitors.
The company's 3-year EPS growth rate showcases its capability to grow its earnings, a critical component for sustaining dividends in the long run. During the past three years, First Hawaiian Inc's earnings increased by approximately -1.70% per year on average, a rate that underperforms than approximately 80.48% of global competitors.
Lastly, the company's 5-year EBITDA growth rate of 2.40%, which underperforms than approximately 69.88% of global competitors.
Next Steps
Considering First Hawaiian Inc's consistent dividend payment history, current yields, and the payout ratio, the company presents an interesting case for investors seeking regular income. However, the growth metrics and profitability rank indicate that while the dividend appears sustainable in the near term, long-term sustainability may hinge on the company's ability to improve its growth trajectory and earnings performance. Value investors may want to keep an eye on these indicators to ensure that future dividends are not only maintained but have the potential for growth. For those looking to expand their portfolio with high-dividend yield stocks, GuruFocus Premium users can utilize the High Dividend Yield Screener for informed investment decisions.
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
This article first appeared on GuruFocus.
