Unity Bancorp (NASDAQ:UNTY) Will Pay A Dividend Of $0.12
Unity Bancorp, Inc. (NASDAQ:UNTY) will pay a dividend of $0.12 on the 29th of December. The dividend yield is 1.8% based on this payment, which is a little bit low compared to the other companies in the industry.
View our latest analysis for Unity Bancorp
Unity Bancorp's Earnings Will Easily Cover The Distributions
It would be nice for the yield to be higher, but we should also check if higher levels of dividend payment would be sustainable.
Unity Bancorp has a long history of paying out dividends, with its current track record at a minimum of 10 years. Using data from its latest earnings report, Unity Bancorp's payout ratio sits at 12%, an extremely comfortable number that shows that it can pay its dividend.
Looking forward, EPS is forecast to rise by 9.9% over the next 3 years. Analysts forecast the future payout ratio could be 12% over the same time horizon, which is a number we think the company can maintain.
Unity Bancorp Has A Solid Track Record
The company has been paying a dividend for a long time, and it has been quite stable which gives us confidence in the future dividend potential. Since 2013, the dividend has gone from $0.0364 total annually to $0.48. This implies that the company grew its distributions at a yearly rate of about 29% over that duration. It is good to see that there has been strong dividend growth, and that there haven't been any cuts for a long time.
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. It's encouraging to see that Unity Bancorp has been growing its earnings per share at 18% a year over the past five years. Unity Bancorp definitely has the potential to grow its dividend in the future with earnings on an uptrend and a low payout ratio.
Unity Bancorp Looks Like A Great Dividend Stock
Overall, we like to see the dividend staying consistent, and we think Unity Bancorp might even raise payments in the future. Earnings are easily covering distributions, and the company is generating plenty of cash. All in all, this checks a lot of the boxes we look for when choosing an income stock.
Companies possessing a stable dividend policy will likely enjoy greater investor interest than those suffering from a more inconsistent approach. Meanwhile, despite the importance of dividend payments, they are not the only factors our readers should know when assessing a company. Companies that are growing earnings tend to be the best dividend stocks over the long term. See what the 3 analysts we track are forecasting for Unity Bancorp for free with public analyst estimates for the company. 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.
