Parke Bancorp (NASDAQ:PKBK) Has Announced A Dividend Of $0.18
Parke Bancorp, Inc. (NASDAQ:PKBK) has announced that it will pay a dividend of $0.18 per share on the 17th of January. This payment means that the dividend yield will be 3.5%, which is around the industry average.
View our latest analysis for Parke Bancorp
Parke Bancorp's Earnings Will Easily Cover The Distributions
Solid dividend yields are great, but they only really help us if the payment is sustainable.
Parke Bancorp has a good history of paying out dividends, with its current track record at 9 years. Past distributions do not necessarily guarantee future ones, but Parke Bancorp's payout ratio of 28% is a good sign for current shareholders as this means that earnings decently cover dividends.
Over the next year, EPS could expand by 7.7% if recent trends continue. Assuming the dividend continues along recent trends, we think the future payout ratio could be 31% by next year, which is in a pretty sustainable range.
Parke Bancorp Is Still Building Its Track Record
The dividend's track record has been pretty solid, but with only 9 years of history we want to see a few more years of history before making any solid conclusions. Since 2014, the dividend has gone from $0.137 total annually to $0.72. This implies that the company grew its distributions at a yearly rate of about 20% over that duration. Parke Bancorp has been growing its dividend quite rapidly, which is exciting. However, the short payment history makes us question whether this performance will persist across a full market cycle.
Parke Bancorp Could Grow Its Dividend
The company's investors will be pleased to have been receiving dividend income for some time. Parke Bancorp has seen EPS rising for the last five years, at 7.7% per annum. Parke Bancorp definitely has the potential to grow its dividend in the future with earnings on an uptrend and a low payout ratio.
In Summary
In summary, we are pleased with the dividend remaining consistent, and we think there is a good chance of this continuing in the future. The dividend has been at reasonable levels historically, but that hasn't translated into a consistent payment. The dividend looks okay, but there have been some issues in the past, so we would be a little bit cautious.
Companies possessing a stable dividend policy will likely enjoy greater investor interest than those suffering from a more inconsistent approach. Still, investors need to consider a host of other factors, apart from dividend payments, when analysing a company. For example, we've picked out 2 warning signs for Parke Bancorp that investors should know about before committing capital to this stock. Is Parke Bancorp not quite the opportunity you were looking for? Why not check out our selection of top 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.
