Shares of Renasant Corporation (NASDAQ:RNST) will begin trading ex-dividend in 2 days. To qualify for the dividend check of $0.19 per share, investors must have owned the shares prior to 14 December 2017, which is the last day the company’s management will finalize their list of shareholders to which they will send dividend payments. Investors looking for higher income-generating stocks to add to their portfolio should keep reading, as I take a deeper dive into RNST’s latest financial data to analyse its dividend attributes. See our latest analysis for RNST
5 checks you should do on a dividend stock
Whenever I am looking at a potential dividend stock investment, I always check these five metrics:
- Does it pay an annual yield higher than 75% of dividend payers?
- Has it consistently paid a stable dividend without missing a payment or drastically cutting payout?
- Has the amount of dividend per share grown over the past?
- Can it afford to pay the current rate of dividends from its earnings?
- Will it be able to continue to payout at the current rate in the future?
How well does Renasant fit our criteria?
Renasant has a payout ratio of 32.73%, which means that the dividend is covered by earnings. In the near future, analysts are predicting lower payout ratio of 27.52%, leading to a dividend yield of around 1.79%. However, EPS should increase to $2.58, meaning that the lower payout ratio does not necessarily implicate a lower dividend payment. If there is one thing that you want to be reliable in your life, it’s dividend stocks and their constant income stream. RNST has increased its DPS from $0.68 to $0.76 in the past 10 years. During this period it has not missed a payment, as one would expect for a company increasing its dividend. This is an impressive feat, which makes RNST a true dividend rockstar. Compared to its peers, RNST has a yield of 1.84%, which is on the low-side for banks stocks.
What this means for you:
Are you a shareholder?
Are you a shareholder? With Renasant producing strong dividend income for your portfolio over the past few years, you can take comfort in knowing that this stock will still continue to be a robust dividend generator moving forward. But, depending on your current holdings, it may be worth exploring other income stocks to improve your diversification, or even look at high-growth stocks to supplement your steady income stocks. I recommend continuing your research by exploring my interactive free list of dividend rockstars as well as high-growth stocks to potentially add to your holdings.
Are you a potential investor? With these dividend metrics in mind, I definitely rank Renasant as a strong income stock, and is worth further research for anyone who considers dividends an important part of their portfolio strategy. As always, I urge potential investors to try and get a good understanding of the underlying business and its fundamentals before deciding on an investment. No matter how much of a cash cow Renasant is, it is not worth an infinite price. Is RNST still a bargain? Check our latest free analysis to find out!
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned.