HomeTrust Bancshares, Inc. (NASDAQ:HTBI) Looks Like A Good Stock, And It's Going Ex-Dividend Soon
HomeTrust Bancshares, Inc. (NASDAQ:HTBI) stock is about to trade ex-dividend in 4 days. The ex-dividend date is one business day before the record date, which is the cut-off date for shareholders to be present on the company's books to be eligible for a dividend payment. The ex-dividend date is important because any transaction on a stock needs to have been settled before the record date in order to be eligible for a dividend. Accordingly, HomeTrust Bancshares investors that purchase the stock on or after the 16th of August will not receive the dividend, which will be paid on the 31st of August.
The company's next dividend payment will be US$0.10 per share, and in the last 12 months, the company paid a total of US$0.40 per share. Last year's total dividend payments show that HomeTrust Bancshares has a trailing yield of 1.6% on the current share price of $24.3. If you buy this business for its dividend, you should have an idea of whether HomeTrust Bancshares's dividend is reliable and sustainable. That's why we should always check whether the dividend payments appear sustainable, and if the company is growing.
See our latest analysis for HomeTrust Bancshares
Dividends are typically paid from company earnings. If a company pays more in dividends than it earned in profit, then the dividend could be unsustainable. HomeTrust Bancshares has a low and conservative payout ratio of just 14% of its income after tax.
Generally speaking, the lower a company's payout ratios, the more resilient its dividend usually is.
Click here to see the company's payout ratio, plus analyst estimates of its future dividends.
Have Earnings And Dividends Been Growing?
Stocks in companies that generate sustainable earnings growth often make the best dividend prospects, as it is easier to lift the dividend when earnings are rising. If earnings decline and the company is forced to cut its dividend, investors could watch the value of their investment go up in smoke. It's encouraging to see HomeTrust Bancshares has grown its earnings rapidly, up 42% a year for the past five years.
Another key way to measure a company's dividend prospects is by measuring its historical rate of dividend growth. HomeTrust Bancshares has delivered 11% dividend growth per year on average over the past five years. Both per-share earnings and dividends have both been growing rapidly in recent times, which is great to see.
Final Takeaway
Is HomeTrust Bancshares worth buying for its dividend? When companies are growing rapidly and retaining a majority of the profits within the business, it's usually a sign that reinvesting earnings creates more value than paying dividends to shareholders. This strategy can add significant value to shareholders over the long term - as long as it's done without issuing too many new shares. Overall, HomeTrust Bancshares looks like a promising dividend stock in this analysis, and we think it would be worth investigating further.
On that note, you'll want to research what risks HomeTrust Bancshares is facing. For example, we've found 2 warning signs for HomeTrust Bancshares that we recommend you consider before investing in the business.
A common investing mistake is buying the first interesting stock you see. Here you can find a full list of high-yield 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.
