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Independent Bank Announces 16% Dividend Hike: Worth a Look?

Zacks Equity Research

Independent Bank Corp. INDB has raised its quarterly common stock dividend by about 16% to 44 cents per share. The dividend will be paid on Apr 5, to shareholders of record as of Mar 25, 2019.

Independent Bank’s robust business model reflects the company’s commitment toward returning value to shareholders with its strong cash-generation capabilities. Prior to this revision, the company had raised its quarterly dividend to 38 cents per share in March 2018, marking an 18.75% hike.

Considering last day’s closing price of $81.50 per share, the dividend yield is currently valued at 2.16%.

Investors interested in this Zacks Rank #3 (Hold) stock can have a look at the bank’s fundamentals and growth prospects.

Revenue Growth: Independent Bank continues to make steady progress toward bolstering its revenues. The company’s projected sales growth (F1/F0) of 23.77% indicates constant upward momentum in revenues.

Earnings Per Share Strength: This bank has witnessed earnings growth of 13.29% in the last three-five years. Additionally, the company’s estimated EPS growth (F1/F0) of 18.98% promises rewards for investors over the long run. Good news is that the company pulled off average positive earnings surprise of 0.36%, over the trailing four quarters.

Superior Return on Equity (ROE): Independent Bank’s ROE of 12.96%, compared with the industry average of 10.31%, highlights the company’s commendable position over its peers.

Strong Leverage: Independent Bank’s debt/equity ratio is 0.24 compared to the industry average of 0.37, indicating a relatively lower debt burden. It highlights the financial stability of the company even in an unstable economic environment.

Share Price Movement: Independent Bank’s shares have gained around 13.8%, over the past three months, compared with 10.1% growth recorded by the industry.

Some other finance stocks which raised their dividends during the current quarter include First Horizon National Corp. FHN, Comerica CMA and Wintrust Financial Corporation WTFC.  First Horizon raised its quarterly dividend by 17%, while Comerica increased by 12%. Also, Wintrust Financial has announced a 31.6% rise in its common stock dividend. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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