Princeton Bancorp (NASDAQ:BPRN) Has Affirmed Its Dividend Of $0.30
Princeton Bancorp, Inc. (NASDAQ:BPRN) has announced that it will pay a dividend of $0.30 per share on the 1st of March. This means the dividend yield will be fairly typical at 3.6%.
View our latest analysis for Princeton Bancorp
Princeton Bancorp's Dividend Forecasted To Be Well Covered By Earnings
We like a dividend to be consistent over the long term, so checking whether it is sustainable is important.
Princeton Bancorp has a good history of paying out dividends, with its current track record at 5 years. Based on Princeton Bancorp's last earnings report, the payout ratio is at a decent 29%, meaning that the company is able to pay out its dividend with a bit of room to spare.
Looking forward, earnings per share is forecast to fall by 39.3% over the next 3 years. Despite that, analysts estimate the future payout ratio could be 46% over the same time period, which is in a pretty comfortable range.
Princeton Bancorp Is Still Building Its Track Record
Princeton Bancorp's dividend has been pretty stable for a little while now, but we will continue to be cautious until it has been demonstrated for a few more years. Since 2019, the dividend has gone from $0.12 total annually to $1.20. This means that it has been growing its distributions at 58% per annum over that time. Princeton 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.
The Dividend Looks Likely To Grow
Investors could be attracted to the stock based on the quality of its payment history. It's encouraging to see that Princeton Bancorp has been growing its earnings per share at 13% a year over the past five years. A low payout ratio and decent growth suggests that the company is reinvesting well, and it also has plenty of room to increase the dividend over time.
We Really Like Princeton Bancorp's Dividend
Overall, we like to see the dividend staying consistent, and we think Princeton Bancorp might even raise payments in the future. The earnings easily cover the company's distributions, and the company is generating plenty of cash. However, it is worth noting that the earnings are expected to fall over the next year, which may not change the long term outlook, but could affect the dividend payment in the next 12 months. All of these factors considered, we think this has solid potential as a dividend stock.
Investors generally tend to favour companies with a consistent, stable dividend policy as opposed to those operating an irregular one. Still, investors need to consider a host of other factors, apart from dividend payments, when analysing a company. To that end, Princeton Bancorp has 2 warning signs (and 1 which is a bit concerning) we think you should know about. 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.
