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Lakeland Financial Corporation (NASDAQ:LKFN) Will Pay US$0.26 In Dividends

If you are interested in cashing in on Lakeland Financial Corporation’s (NASDAQ:LKFN) upcoming dividend of US$0.26 per share, you only have 4 days left to buy the shares before its ex-dividend date, 24 October 2018, in time for dividends payable on the 05 November 2018. What does this mean for current shareholders and potential investors? Below, I will explain how holding Lakeland Financial can impact your portfolio income stream, by analysing the stock’s most recent financial data and dividend attributes.

View our latest analysis for Lakeland Financial

5 questions I ask before picking a dividend stock

When researching a dividend stock, I always follow the following screening criteria:

  • Is it paying an annual yield above 75% of dividend payers?

  • Has its dividend been stable over the past (i.e. no missed payments or significant payout cuts)?

  • Has dividend per share risen in the past couple of years?

  • Is is able 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?

NasdaqGS:LKFN Historical Dividend Yield October 19th 18
NasdaqGS:LKFN Historical Dividend Yield October 19th 18

Does Lakeland Financial pass our checks?

The current trailing twelve-month payout ratio for the stock is 37%, which means that the dividend is covered by earnings. Going forward, analysts expect LKFN’s payout to remain around the same level at 34% of its earnings, which leads to a dividend yield of around 2.4%. Furthermore, EPS should increase to $3.18.

When considering the sustainability of dividends, it is also worth checking the cash flow of a company. Companies with strong cash flow can sustain a higher payout ratio, while companies with weaker cash flow generally cannot.

If there’s one type of stock you want to be reliable, it’s dividend stocks and their stable income-generating ability. LKFN has increased its DPS from $0.41 to $1.04 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.

Compared to its peers, Lakeland Financial has a yield of 2.4%, which is on the low-side for Banks stocks.

Next Steps:

Keeping in mind the dividend characteristics above, Lakeland Financial is definitely worth considering for investors looking to build a dedicated income portfolio. Given that this is purely a dividend analysis, I recommend taking sufficient time to understand its core business and determine whether the company and its investment properties suit your overall goals. I’ve put together three essential aspects you should look at:

  1. Future Outlook: What are well-informed industry analysts predicting for LKFN’s future growth? Take a look at our free research report of analyst consensus for LKFN’s outlook.

  2. Valuation: What is LKFN 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 LKFN is currently mispriced by the market.

  3. Other Dividend Rockstars: Are there better dividend payers with stronger fundamentals out there? Check out our free list of these great stocks here.

To help readers see past 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. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.