U.S. markets open in 3 hours 44 minutes
  • S&P Futures

    4,255.25
    -31.25 (-0.73%)
     
  • Dow Futures

    33,796.00
    -185.00 (-0.54%)
     
  • Nasdaq Futures

    13,404.50
    -118.75 (-0.88%)
     
  • Russell 2000 Futures

    1,983.50
    -18.20 (-0.91%)
     
  • Crude Oil

    89.34
    -1.16 (-1.28%)
     
  • Gold

    1,767.00
    -4.20 (-0.24%)
     
  • Silver

    19.14
    -0.33 (-1.69%)
     
  • EUR/USD

    1.0079
    -0.0013 (-0.13%)
     
  • 10-Yr Bond

    2.8800
    0.0000 (0.00%)
     
  • Vix

    20.50
    +0.60 (+3.02%)
     
  • GBP/USD

    1.1873
    -0.0060 (-0.50%)
     
  • USD/JPY

    136.5710
    +0.7090 (+0.52%)
     
  • BTC-USD

    21,779.44
    -1,712.61 (-7.29%)
     
  • CMC Crypto 200

    517.73
    -40.00 (-7.17%)
     
  • FTSE 100

    7,549.97
    +8.12 (+0.11%)
     
  • Nikkei 225

    28,930.33
    -11.81 (-0.04%)
     

Plumas Bancorp (NASDAQ:PLBC) Passed Our Checks, And It's About To Pay A US$0.14 Dividend

  • Oops!
    Something went wrong.
    Please try again later.
·3 min read
In this article:
  • Oops!
    Something went wrong.
    Please try again later.

Regular readers will know that we love our dividends at Simply Wall St, which is why it's exciting to see Plumas Bancorp (NASDAQ:PLBC) is about to trade ex-dividend in the next 3 days. The ex-dividend date is one business day before the record date, which is the cut-off date for shareholders to be present on the company's books to be eligible for a dividend payment. It is important to be aware of the ex-dividend date because any trade on the stock needs to have been settled on or before the record date. Therefore, if you purchase Plumas Bancorp's shares on or after the 30th of July, you won't be eligible to receive the dividend, when it is paid on the 16th of August.

The company's upcoming dividend is US$0.14 a share, following on from the last 12 months, when the company distributed a total of US$0.56 per share to shareholders. Last year's total dividend payments show that Plumas Bancorp has a trailing yield of 1.7% on the current share price of $33.15. Dividends are an important source of income to many shareholders, but the health of the business is crucial to maintaining those dividends. As a result, readers should always check whether Plumas Bancorp has been able to grow its dividends, or if the dividend might be cut.

See our latest analysis for Plumas Bancorp

Dividends are typically paid from company earnings. If a company pays more in dividends than it earned in profit, then the dividend could be unsustainable. Plumas Bancorp has a low and conservative payout ratio of just 16% of its income after tax.

Generally speaking, the lower a company's payout ratios, the more resilient its dividend usually is.

Click here to see how much of its profit Plumas Bancorp paid out over the last 12 months.

historic-dividend
historic-dividend

Have Earnings And Dividends Been Growing?

Businesses with strong growth prospects usually make the best dividend payers, because it's easier to grow dividends when earnings per share are improving. If earnings fall far enough, the company could be forced to cut its dividend. It's encouraging to see Plumas Bancorp has grown its earnings rapidly, up 22% a year for the past five years.

The main way most investors will assess a company's dividend prospects is by checking the historical rate of dividend growth. Plumas Bancorp has delivered an average of 23% per year annual increase in its dividend, based on the past five years of dividend payments. It's exciting to see that both earnings and dividends per share have grown rapidly over the past few years.

To Sum It Up

Is Plumas Bancorp worth buying for its dividend? Typically, companies that are growing rapidly and paying out a low fraction of earnings are keeping the profits for reinvestment in the business. Perhaps even more importantly - this can sometimes signal management is focused on the long term future of the business. Plumas Bancorp ticks a lot of boxes for us from a dividend perspective, and we think these characteristics should mark the company as deserving of further attention.

While it's tempting to invest in Plumas Bancorp for the dividends alone, you should always be mindful of the risks involved. To help with this, we've discovered 2 warning signs for Plumas Bancorp that you should be aware of before investing in their shares.

If you're in the market for dividend stocks, we recommend checking our list of top dividend stocks with a greater than 2% yield and an upcoming dividend.

This article by Simply Wall St is general in nature. 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.