SB Financial Group, Inc. (SBFG) Could Be a Great Choice
All investors love getting big returns from their portfolio, whether it's through stocks, bonds, ETFs, or other types of securities. However, when you're an income investor, your primary focus is generating consistent cash flow from each of your liquid investments.
Cash flow can come from bond interest, interest from other types of investments, and of course, dividends. A dividend is that coveted distribution of a company's earnings paid out to shareholders, and investors often view it by its dividend yield, a metric that measures the dividend as a percent of the current stock price. Many academic studies show that dividends make up large portions of long-term returns, and in many cases, dividend contributions surpass one-third of total returns.
SB Financial Group, Inc. In Focus
SB Financial Group, Inc. (SBFG) is headquartered in Defiance, and is in the Finance sector. The stock has seen a price change of -18.53% since the start of the year. Currently paying a dividend of $0.13 per share, the company has a dividend yield of 3.62%. In comparison, the Banks - Northeast industry's yield is 2.93%, while the S&P 500's yield is 1.73%.
Taking a look at the company's dividend growth, its current annualized dividend of $0.50 is up 4.2% from last year. SB Financial Group, Inc. has increased its dividend 5 times on a year-over-year basis over the last 5 years for an average annual increase of 11.79%. Future dividend growth will depend on earnings growth as well as payout ratio, which is the proportion of a company's annual earnings per share that it pays out as a dividend. SB Financial Group, Inc.'s current payout ratio is 31%. This means it paid out 31% of its trailing 12-month EPS as dividend.
SBFG is expecting earnings to expand this fiscal year as well. The Zacks Consensus Estimate for 2023 is $1.77 per share, with earnings expected to increase 8.59% from the year ago period.
Bottom Line
Investors like dividends for many reasons; they greatly improve stock investing profits, decrease overall portfolio risk, and carry tax advantages, among others. It's important to keep in mind that not all companies provide a quarterly payout.
For instance, it's a rare occurrence when a tech start-up or big growth business offers their shareholders a dividend. It's more common to see larger companies with more established profits give out dividends. Income investors must be conscious of the fact that high-yielding stocks tend to struggle during periods of rising interest rates. With that in mind, SBFG presents a compelling investment opportunity; it's not only an attractive dividend play, but the stock also boasts a strong Zacks Rank of #2 (Buy).
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SB Financial Group, Inc. (SBFG) : Free Stock Analysis Report
