Franklin Financial Services (NASDAQ:FRAF) Will Pay A Dividend Of $0.32
Franklin Financial Services Corporation's (NASDAQ:FRAF) investors are due to receive a payment of $0.32 per share on 28th of February. This payment means that the dividend yield will be 3.8%, which is around the industry average.
Check out our latest analysis for Franklin Financial Services
Franklin Financial Services' Earnings Will Easily Cover The Distributions
We like a dividend to be consistent over the long term, so checking whether it is sustainable is important.
Franklin Financial Services has a long history of paying out dividends, with its current track record at a minimum of 10 years. Past distributions do not necessarily guarantee future ones, but Franklin Financial Services' payout ratio of 40% is a good sign as this means that earnings decently cover dividends.
Looking forward, earnings per share could rise by 13.9% over the next year if the trend from the last few years continues. Assuming the dividend continues along recent trends, we think the future payout ratio could be 38% by next year, which is in a pretty sustainable range.
Franklin Financial Services Has A Solid Track Record
The company has a sustained record of paying dividends with very little fluctuation. Since 2014, the annual payment back then was $0.68, compared to the most recent full-year payment of $1.28. This means that it has been growing its distributions at 6.5% per annum over that time. The dividend has been growing very nicely for a number of years, and has given its shareholders some nice income in their portfolios.
The Dividend Looks Likely To Grow
Investors could be attracted to the stock based on the quality of its payment history. It's encouraging to see that Franklin Financial Services has been growing its earnings per share at 14% a year over the past five years. Shareholders are getting plenty of the earnings returned to them, which combined with strong growth makes this quite appealing.
Franklin Financial Services Looks Like A Great Dividend Stock
Overall, we think that this is a great income investment, and we think that maintaining the dividend this year may have been a conservative choice. 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.
Market movements attest to how highly valued a consistent dividend policy is compared to one which is more unpredictable. At the same time, there are other factors our readers should be conscious of before pouring capital into a stock. Now, if you want to look closer, it would be worth checking out our free research on Franklin Financial Services management tenure, salary, and performance. Looking for more high-yielding dividend ideas? Try our collection of strong dividend payers.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.
