Be Sure To Check Out Ohio Valley Banc Corp. (NASDAQ:OVBC) Before It Goes Ex-Dividend
It looks like Ohio Valley Banc Corp. (NASDAQ:OVBC) is about to go ex-dividend in the next four days. Typically, the ex-dividend date is one business day before the record date which is the date on which a company determines the shareholders eligible to receive a dividend. The ex-dividend date is important as the process of settlement involves two full business days. So if you miss that date, you would not show up on the company's books on the record date. Therefore, if you purchase Ohio Valley Banc's shares on or after the 27th of April, you won't be eligible to receive the dividend, when it is paid on the 10th of May.
The company's next dividend payment will be US$0.22 per share. Last year, in total, the company distributed US$0.84 to shareholders. Based on the last year's worth of payments, Ohio Valley Banc stock has a trailing yield of around 3.4% on the current share price of $24.89. Dividends are a major contributor to investment returns for long term holders, but only if the dividend continues to be paid. As a result, readers should always check whether Ohio Valley Banc has been able to grow its dividends, or if the dividend might be cut.
See our latest analysis for Ohio Valley Banc
If a company pays out more in dividends than it earned, then the dividend might become unsustainable - hardly an ideal situation. Ohio Valley Banc paid out a comfortable 30% of its profit last year.
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 Ohio Valley Banc paid out over the last 12 months.
Have Earnings And Dividends Been Growing?
Stocks in companies that generate sustainable earnings growth often make the best dividend prospects, as it is easier to lift the dividend when earnings are rising. If earnings fall far enough, the company could be forced to cut its dividend. Fortunately for readers, Ohio Valley Banc's earnings per share have been growing at 12% a year for the past five years.
Another key way to measure a company's dividend prospects is by measuring its historical rate of dividend growth. It looks like the Ohio Valley Banc dividends are largely the same as they were 10 years ago.
To Sum It Up
Should investors buy Ohio Valley Banc for the upcoming dividend? When companies are growing rapidly and retaining a majority of the profits within the business, it's usually a sign that reinvesting earnings creates more value than paying dividends to shareholders. This strategy can add significant value to shareholders over the long term - as long as it's done without issuing too many new shares. We think this is a pretty attractive combination, and would be interested in investigating Ohio Valley Banc more closely.
Keen to explore more data on Ohio Valley Banc's financial performance? Check out our visualisation of its historical revenue and earnings growth.
If you're in the market for strong dividend payers, we recommend checking our selection of top dividend stocks.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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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