Ohio Valley Banc (NASDAQ:OVBC) Has Affirmed Its Dividend Of $0.15
Ohio Valley Banc Corp. (NASDAQ:OVBC) has announced that it will pay a dividend of $0.15 per share on the 10th of June. This means the dividend yield will be fairly typical at 3.6%.
Check out our latest analysis for Ohio Valley Banc
Ohio Valley Banc's Dividend Forecasted To Be Well Covered By Earnings
Unless the payments are sustainable, the dividend yield doesn't mean too much.
Ohio Valley Banc has established itself as a dividend paying company with over 10 years history of distributing earnings to shareholders. Based on Ohio Valley Banc's last earnings report, the payout ratio is at a decent 31%, meaning that the company is able to pay out its dividend with a bit of room to spare.
Looking forward, earnings per share could rise by 11.0% over the next year if the trend from the last few years continues. If the dividend continues along recent trends, we estimate the future payout ratio will be 33%, which is in the range that makes us comfortable with the sustainability of the dividend.
Ohio Valley Banc Has A Solid Track Record
The company has an extended history of paying stable dividends. The dividend has gone from an annual total of $0.84 in 2013 to the most recent total annual payment of $0.88. Its dividends have grown at less than 1% per annum over this time frame. While the consistency in the dividend payments is impressive, we think the relatively slow rate of growth is less attractive.
The Dividend Looks Likely To Grow
Some investors will be chomping at the bit to buy some of the company's stock based on its dividend history. We are encouraged to see that Ohio Valley Banc has grown earnings per share at 11% per year over the past five years. Growth in EPS bodes well for the dividend, as does the low payout ratio that the company is currently reporting.
Ohio Valley Banc Looks Like A Great Dividend Stock
Overall, we think that this is a great income investment, and we think that maintaining the dividend this year may have been a conservative choice. Earnings are easily covering distributions, and the company is generating plenty of cash. All of these factors considered, we think this has solid potential as a dividend stock.
Market movements attest to how highly valued a consistent dividend policy is compared to one which is more unpredictable. Still, investors need to consider a host of other factors, apart from dividend payments, when analysing a company. Now, if you want to look closer, it would be worth checking out our free research on Ohio Valley Banc management tenure, salary, and performance. If you are a dividend investor, you might also want to look at our curated list of high yield dividend stocks.
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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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