Are You Looking for a High-Growth Dividend Stock?
All investors love getting big returns from their portfolio, whether it's through stocks, bonds, ETFs, or other types of securities. However, when you're an income investor, your primary focus is generating consistent cash flow from each of your liquid investments.
Cash flow can come from bond interest, interest from other types of investments, and of course, dividends. A dividend is that coveted distribution of a company's earnings paid out to shareholders, and investors often view it by its dividend yield, a metric that measures the dividend as a percent of the current stock price. Many academic studies show that dividends account for significant portions of long-term returns, with dividend contributions exceeding one-third of total returns in many cases.
SB Financial Group, Inc. In Focus
SB Financial Group, Inc. (SBFG) is headquartered in Defiance, and is in the Finance sector. The stock has seen a price change of -18.17% since the start of the year. Currently paying a dividend of $0.13 per share, the company has a dividend yield of 3.6%. In comparison, the Banks - Northeast industry's yield is 2.86%, while the S&P 500's yield is 1.77%.
Taking a look at the company's dividend growth, its current annualized dividend of $0.50 is up 4.2% from last year. In the past five-year period, SB Financial Group, Inc. has increased its dividend 5 times on a year-over-year basis for an average annual increase of 11.79%. Future dividend growth will depend on earnings growth as well as payout ratio, which is the proportion of a company's annual earnings per share that it pays out as a dividend. SB Financial Group, Inc.'s current payout ratio is 31%. This means it paid out 31% of its trailing 12-month EPS as dividend.
SBFG is expecting earnings to expand this fiscal year as well. The Zacks Consensus Estimate for 2023 is $1.77 per share, which represents a year-over-year growth rate of 8.59%.
Bottom Line
From greatly improving stock investing profits and reducing overall portfolio risk to providing tax advantages, investors like dividends for a variety of different reasons. It's important to keep in mind that not all companies provide a quarterly payout.
For instance, it's a rare occurrence when a tech start-up or big growth business offers their shareholders a dividend. It's more common to see larger companies with more established profits give out dividends. Income investors must be conscious of the fact that high-yielding stocks tend to struggle during periods of rising interest rates. That said, they can take comfort from the fact that SBFG is not only an attractive dividend play, but is also a compelling investment opportunity with a Zacks Rank of #2 (Buy).
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SB Financial Group, Inc. (SBFG) : Free Stock Analysis Report
