Macatawa Bank Corporation (MCBC): Dividend Is Coming In 3 Days, Should You Buy?
Investors who want to cash in on Macatawa Bank Corporation’s (NASDAQ:MCBC) upcoming dividend of $0.05 per share have only 3 days left to buy the shares before its ex-dividend date, 13 November 2017, in time for dividends payable on the 29 November 2017. Should you diversify into MCBC and boost your portfolio income stream? Well, keep on reading because today, I’m going to look at the latest data and analyze the stock and its dividend property in further detail. Check out our latest analysis for Macatawa Bank
How I analyze a dividend stock
When assessing a stock as a potential addition to my dividend Portfolio, I look at these five areas:
Is it the top 25% annual dividend yield payer?
Does it consistently pay out dividends without missing a payment of significantly cutting payout?
Has it increased its dividend per share amount over the past?
Can it afford to pay the current rate of dividends from its earnings?
Will it have the ability to keep paying its dividends going forward?
How does Macatawa Bank fare?
Macatawa Bank has a payout ratio of 29.83%, meaning the dividend is sufficiently covered by earnings. Looking forward, analysts expect MCBC to pay out 37.01% of its earnings and dividends yield to be around 2.14%. Furthermore, EPS should increase to $0.58. This means the company should be able to continue to payout dividends. If there is one thing that you want to be reliable in your life, it’s dividend stocks and their constant income stream. Not only have dividend payouts from Macatawa Bank fallen over the past 10 years, it has also been highly volatile during this time, with drops of over 25% in some years. This means that dividend hunters should probably steer clear of the stock, at least for now until the track record improves. Relative to peers, MCBC generates a yield of 2.07%, which is on the low-side for banks stocks.
What this means for you:
Are you a shareholder? Investors may not have the best feeling about their investment in MCBC right now, in terms of its dividend attributes. It may be beneficial exploring other dividend stocks as alternatives to MCBC or even look at high-growth stocks to complement your steady income stocks. I recommend continuing your research by taking a look at my interactive free list of dividend rockstars as well as high-growth stocks to potentially add to your holdings.
Are you a potential investor? Now you know to keep in mind the reason why investors should be careful investing in MCBC for the dividend. But if you are not exclusively a dividend investor, MCBC could still be an interesting investment opportunity. As always, I urge potential investors to try and get a good understanding of the underlying business and its fundamentals before deciding on an investment. Take a look at our latest free fundmental analysis to explore other aspects of MCBC.
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.
