International Bancshares (NASDAQ:IBOC) Is Paying Out A Larger Dividend Than Last Year
International Bancshares Corporation (NASDAQ:IBOC) will increase its dividend from last year's comparable payment on the 25th of August to $0.63. This takes the annual payment to 2.5% of the current stock price, which unfortunately is below what the industry is paying.
See our latest analysis for International Bancshares
International Bancshares' Payment Expected To Have Solid Earnings Coverage
It would be nice for the yield to be higher, but we should also check if higher levels of dividend payment would be sustainable.
International Bancshares has established itself as a dividend paying company with over 10 years history of distributing earnings to shareholders. Using data from its latest earnings report, International Bancshares' payout ratio sits at 22%, an extremely comfortable number that shows that it can pay its dividend.
Looking forward, earnings per share could rise by 15.7% over the next year if the trend from the last few years continues. If the dividend continues on this path, the future payout ratio could be 22% by next year, which we think can be pretty sustainable going forward.
International Bancshares Has A Solid Track Record
Even over a long history of paying dividends, the company's distributions have been remarkably stable. Since 2013, the annual payment back then was $0.40, compared to the most recent full-year payment of $1.26. This works out to be a compound annual growth rate (CAGR) of approximately 12% a year over that time. It is good to see that there has been strong dividend growth, and that there haven't been any cuts for a long time.
The Dividend Looks Likely To Grow
The company's investors will be pleased to have been receiving dividend income for some time. International Bancshares has impressed us by growing EPS at 16% per year over the past five years. With a decent amount of growth and a low payout ratio, we think this bodes well for International Bancshares' prospects of growing its dividend payments in the future.
International Bancshares Looks Like A Great Dividend Stock
Overall, a dividend increase is always good, and we think that International Bancshares is a strong income stock thanks to its track record and growing earnings. Distributions are quite easily covered by earnings, which are also being converted to cash flows. All in all, this checks a lot of the boxes we look for when choosing an income stock.
Market movements attest to how highly valued a consistent dividend policy is compared to one which is more unpredictable. However, there are other things to consider for investors when analysing stock performance. Now, if you want to look closer, it would be worth checking out our free research on International Bancshares management tenure, salary, and performance. Looking for more high-yielding dividend ideas? Try our collection of strong dividend payers.
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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.
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