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Fulton (FULT) Stock Up on Special Dividend, Buyback Extension

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  • OZK
  • WASH

Shares of Fulton Financial Corporation FULT have rallied 2.3% in response to the announcement of a special dividend and extension of share repurchase program. These efforts will go a long way in enhancing shareholder value.

Fulton Financial has announced a special dividend of 8 cents per share. The dividend will be paid out on Dec 15 to shareholders on record as of Dec 1. FULT has been announcing special dividends annually since 2014.

Also, Fulton Financial pays a regular quarterly cash dividend. The company last hiked its dividend by 7.7% to 14 cents per share this April. Based on last day’s closing price of $17.03, the company’s dividend yield currently stands at 3.29%. The yield is impressive compared with the industry average of 1.82%. This yield is not only attractive for income investors but also represents a steady income stream.

Further, in February 2021, Fulton Financial had announced a share buyback program authorizing the repurchase of $75 million worth of shares. The plan was set to expire in December 2021. It has now been extended till March 2022. As of Nov 19, 2021, nearly $45.8 million remained available under the authorization.

Fulton Financial has a solid balance sheet and liquidity position. As of Sep 30, 2021, total debt amounted to $1.1 billion, while cash and cash equivalents were $2.47 billion. Also, the company maintains an investment-grade credit ratings of Baa1 and a stable outlook from Moody’s Investor Service. Earnings strength also indicates that Fulton Financial’s capital deployments are sustainable.

Shares of Fulton Financial have rallied 33.9% so far this year, underperforming the industry’s 50.7% jump.

Zacks Investment Research
Zacks Investment Research

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Currently, Fulton Financial carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Other Banks Undertaking Enhanced Capital Deployment Actions

Over the past few months, several banks have rewarded shareholders with new share-repurchase programs or dividend hikes. Some of these are Washington Trust Bancorp, Inc. WASH, United Community Banks, Inc. UCBI and Bank OZK OZK.

Washington Trust’s board of directors has approved the repurchase of about 5% of the outstanding common stock or 850,000 shares. WASH’s new buyback plan expires on Dec 31, 2022.

As of Oct 31, 2021, Washington Trust had nearly 17.3 million shares outstanding.

United Community Banks announced a new share repurchase plan, under which it is authorized to buy back up to $50 million outstanding shares. The plan will expire on Dec 31, 2022.

The new repurchase plan replaces the previous one, which authorized United Community Banks to buy back up to $50 million shares till Dec 31, 2021. As of Sep 30, 2021, UCBI had the authorization to repurchase shares worth $34.9 million remaining under the earlier plan.

Bank OZK had declared a quarterly cash dividend of 29 cents per share, reflecting a rise of 1.8% from the prior payout. The dividend was paid out on Oct 22 to shareholders on record as of Oct 15.

This was the 45th consecutive quarter of a dividend hike by Bank OZK. Prior to this, the company hiked its dividend by 1.8% to 28.5 cents per share in July. We believe that such disbursements highlight OZK’s operational strength and commitment toward enhancing shareholder wealth.

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Fulton Financial Corporation (FULT) : Free Stock Analysis Report

United Community Banks, Inc. (UCBI) : Free Stock Analysis Report

Washington Trust Bancorp, Inc. (WASH) : Free Stock Analysis Report

Bank OZK (OZK) : Free Stock Analysis Report

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Zacks Investment Research