Over the past 10 years Cullen/Frost Bankers Inc (NYSE:CFR) has returned an average of 3.00% per year from dividend payouts. The company is currently worth US$6.94B, and now yields roughly 2.10%. Should it have a place in your portfolio? Let’s take a look at Cullen/Frost Bankers in more detail. View our latest analysis for Cullen/Frost Bankers
5 questions I ask before picking a dividend stock
When assessing a stock as a potential addition to my dividend Portfolio, I look at these five areas:
- Is its annual yield among the top 25% of dividend-paying companies?
- Has it consistently paid a stable dividend without missing a payment or drastically cutting payout?
- Has it increased its dividend per share amount over the past?
- Does earnings amply cover its dividend payments?
- Will it be able to continue to payout at the current rate in the future?
Does Cullen/Frost Bankers pass our checks?
The company currently pays out 40.48% of its earnings as a dividend, according to its trailing twelve-month data, which means that the dividend is covered by earnings. Going forward, analysts expect CFR’s payout to remain around the same level at 38.62% of its earnings, which leads to a dividend yield of around 2.24%. Furthermore, EPS should increase to $6.36. If dividend is a key criteria in your investment consideration, then you need to make sure the dividend stock you’re eyeing out is reliable in its payments. In the case of CFR it has increased its DPS from $1.68 to $2.28 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, Cullen/Frost Bankers produces a yield of 2.10%, which is on the low-side for Banks stocks.
With this in mind, I definitely rank Cullen/Frost Bankers as a strong dividend stock, and makes it worth further research for anyone who likes steady income generation from their portfolio. Given that this is purely a dividend analysis, you should always research extensively before deciding whether or not a stock is an appropriate investment for you. I always recommend analysing the company’s fundamentals and underlying business before making an investment decision. There are three essential aspects you should look at:
- Future Outlook: What are well-informed industry analysts predicting for CFR’s future growth? Take a look at our free research report of analyst consensus for CFR’s outlook.
- Valuation: What is CFR 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 CFR is currently mispriced by the market.
- 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 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.