Parke Bancorp's (NASDAQ:PKBK) Dividend Will Be $0.18
The board of Parke Bancorp, Inc. (NASDAQ:PKBK) has announced that it will pay a dividend of $0.18 per share on the 19th of April. Based on this payment, the dividend yield on the company's stock will be 4.3%, which is an attractive boost to shareholder returns.
Check out our latest analysis for Parke Bancorp
Parke Bancorp's Dividend Forecasted To Be Well Covered By Earnings
Impressive dividend yields are good, but this doesn't matter much if the payments can't be sustained.
Parke Bancorp has a long history of paying out dividends, with its current track record at a minimum of 10 years. Taking data from its last earnings report, calculating for the company's payout ratio shows 30%, which means that Parke Bancorp would be able to pay its last dividend without pressure on the balance sheet.
If the trend of the last few years continues, EPS will grow by 0.7% over the next 12 months. If the dividend continues on this path, the future payout ratio could be 35% by next year, which we think can be pretty sustainable going forward.
Parke Bancorp Has A Solid Track Record
The company has an extended history of paying stable dividends. The dividend has gone from an annual total of $0.137 in 2014 to the most recent total annual payment of $0.72. This works out to be a compound annual growth rate (CAGR) of approximately 18% a year over that time. We can see that payments have shown some very nice upward momentum without faltering, which provides some reassurance that future payments will also be reliable.
Dividend Growth May Be Hard To Achieve
Investors who have held shares in the company for the past few years will be happy with the dividend income they have received. Parke Bancorp hasn't seen much change in its earnings per share over the last five years. While growth may be thin on the ground, Parke Bancorp could always pay out a higher proportion of earnings to increase shareholder returns.
We Really Like Parke Bancorp's Dividend
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.
It's important to note that companies having a consistent dividend policy will generate greater investor confidence than those having an erratic one. Meanwhile, despite the importance of dividend payments, they are not the only factors our readers should know when assessing a company. As an example, we've identified 1 warning sign for Parke Bancorp that you should be aware of before investing. Looking for more high-yielding dividend ideas? Try our collection of strong dividend payers.
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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.
