Southern States Bancshares' (NASDAQ:SSBK) Dividend Will Be $0.09
The board of Southern States Bancshares, Inc. (NASDAQ:SSBK) has announced that it will pay a dividend on the 17th of November, with investors receiving $0.09 per share. Including this payment, the dividend yield on the stock will be 1.6%, which is a modest boost for shareholders' returns.
Check out our latest analysis for Southern States Bancshares
Southern States Bancshares' Payment Expected To Have Solid Earnings Coverage
The dividend yield is a little bit low, but sustainability of the payments is also an important part of evaluating an income stock.
Southern States Bancshares is just starting to establish itself as being able to pay dividends to shareholders, given its short 2-year history of distributing earnings. Based on its last earnings report however, the payout ratio is at a comfortable 9.3%, meaning that Southern States Bancshares may be able to sustain this dividend for future years if it continues on this earnings trend.
EPS is set to fall by 25.0% over the next 12 months. But if the dividend continues along the path it has been on recently, we estimate the future payout ratio could be 13%, which would be comfortable for the company to continue in the future.
Southern States Bancshares Is Still Building Its Track Record
Looking back, the dividend has been stable, but the company hasn't been paying a dividend for very long so we can't be confident that the dividend will remain stable through all economic environments. The last annual payment of $0.36 was flat on the annual payment from2 years ago. Southern States Bancshares hasn't been paying a dividend for very long, so we wouldn't get to excited about its record of growth just yet.
The Dividend Looks Likely To Grow
Investors who have held shares in the company for the past few years will be happy with the dividend income they have received. Southern States Bancshares has seen EPS rising for the last five years, at 26% per annum. Rapid earnings growth and a low payout ratio suggest this company has been effectively reinvesting in its business. Should that continue, this company could have a bright future.
Southern States Bancshares Looks Like A Great Dividend Stock
In summary, it is good to see that the dividend is staying consistent, and we don't think there is any reason to suspect this might change over the medium term. The distributions are easily covered by earnings, and there is plenty of cash being generated as well. If earnings do fall over the next 12 months, the dividend could be buffeted a little bit, but we don't think it should cause too much of a problem in the long term. Taking this all into consideration, this looks like it could be a good dividend opportunity.
Market movements attest to how highly valued a consistent dividend policy is compared to one which is more unpredictable. At the same time, there are other factors our readers should be conscious of before pouring capital into a stock. For instance, we've picked out 1 warning sign for Southern States Bancshares that investors should take into consideration. 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.
