If you are an income investor, then United Bankshares Inc (NASDAQ:UBSI) should be on your radar. United Bankshares, Inc. operates as the bank holding company for United Bank (WV) and United Bank (VA) that provide commercial and retail banking services and products primarily in the United States. Over the past 10 years, the $3.81B market cap company has been growing its dividend payments, from $1.16 to $1.36. Currently yielding 3.75%, let’s take a closer look at United Bankshares’s dividend profile. See our latest analysis for United Bankshares
What Is A Dividend Rock Star?
It is a stock that pays a reliable and steady dividend over the past decade, at a rate that is competitive relative to the other dividend-paying companies on the market. More specifically: Its annual yield is among the top 25% of dividend payers It has paid dividend every year without dramatically reducing payout in the past Its has increased its dividend per share amount over the past It can afford to pay the current rate of dividends from its earnings It is able to continue to payout at the current rate in the future
High Yield And Dependable
United Bankshares’s dividend yield stands at 3.75%, which is high for banks stocks. But the real reason United Bankshares stands out is because it has a high chance of being able to continue to pay dividend at this level for years to come, something that is quite desirable if you are looking to create a portfolio that generates a steady stream of income.
If there is one thing that you want to be reliable in your life, it’s dividend stocks and their constant income stream. UBSI has increased its DPS from $1.16 to $1.36 in the past 10 years. During this period it has not missed a payment, as one would expect for a company increasing its dividend. These are all positive signs of a great, reliable dividend stock. The company currently pays out 69.69% of its earnings as a dividend, which means that the dividend is covered by earnings. However, going forward, analysts expect UBSI’s payout to fall to 55.11% of its earnings, which leads to a dividend yield of 3.83%. However, EPS should increase to $2.27, meaning that the lower payout ratio does not necessarily implicate a lower dividend payment.
There aren’t many other stocks out there with the same track record as United Bankshares, so I would certainly recommend further examining the stock if its dividend characteristics appeal to you. However, given this is purely a dividend analysis, you should always research extensively before deciding whether or not a stock is an appropriate investment for you. I always recommend analysing the company’s fundamentals and underlying business before making an investment decision. There are three essential factors you should further examine:
1. Future Outlook: What are well-informed industry analysts predicting for UBSI’s future growth? Take a look at our free research report of analyst consensus for UBSI’s outlook.
2. Valuation: What is UBSI worth today? Even if the stock is a cash cow, it’s not worth an infinite price. The intrinsic value infographic in our free research report helps visualize whether UBSI is currently mispriced by the market.
3. Other Dividend Rockstars: Are there strong dividend payers with better fundamentals out there? Check out our free list of these great stocks here.
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.