Pinnacle Financial Partners (NASDAQ:PNFP) Has Announced A Dividend Of $0.22
Pinnacle Financial Partners, Inc.'s (NASDAQ:PNFP) investors are due to receive a payment of $0.22 per share on 26th of May. The dividend yield is 1.6% based on this payment, which is a little bit low compared to the other companies in the industry.
View our latest analysis for Pinnacle Financial Partners
Pinnacle Financial Partners' Dividend Forecasted To Be Well Covered By Earnings
It would be nice for the yield to be higher, but we should also check if higher levels of dividend payment would be sustainable.
Having paid out dividends for 9 years, Pinnacle Financial Partners has a good history of paying out a part of its earnings to shareholders. While past data isn't a guarantee for the future, Pinnacle Financial Partners' latest earnings report puts its payout ratio at 12%, showing that the company can pay out its dividends comfortably.
Looking forward, earnings per share is forecast to rise by 0.9% over the next year. Assuming the dividend continues along recent trends, we think the future payout ratio could be 13% by next year, which is in a pretty sustainable range.
Pinnacle Financial Partners Is Still Building Its Track Record
It is great to see that Pinnacle Financial Partners has been paying a stable dividend for a number of years now, however we want to be a bit cautious about whether this will remain true through a full economic cycle. Since 2014, the dividend has gone from $0.32 total annually to $0.88. This means that it has been growing its distributions at 12% per annum over that time. We're not overly excited about the relatively short history of dividend payments, however the dividend is growing at a nice rate and we might take a closer look.
The Dividend Looks Likely To Grow
Investors could be attracted to the stock based on the quality of its payment history. Pinnacle Financial Partners has impressed us by growing EPS at 19% per year over the past five years. Pinnacle Financial Partners definitely has the potential to grow its dividend in the future with earnings on an uptrend and a low payout ratio.
We Really Like Pinnacle Financial Partners' 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.
Companies possessing a stable dividend policy will likely enjoy greater investor interest than those suffering from a more inconsistent approach. At the same time, there are other factors our readers should be conscious of before pouring capital into a stock. Just as an example, we've come across 2 warning signs for Pinnacle Financial Partners you should be aware of, and 1 of them is potentially serious. 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.
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