Unveiling the Dividend Performance of Waterstone Financial Inc: A Deep Dive
Examining the Dividend History, Yield, Growth, and Sustainability of Waterstone Financial Inc (NASDAQ:WSBF)
Waterstone Financial Inc (NASDAQ:WSBF) recently announced a dividend of $0.15 per share, payable on 2023-11-01, with the ex-dividend date set for 2023-10-06. As investors anticipate this upcoming payment, it's vital to scrutinize the company's dividend history, yield, and growth rates. Using GuruFocus data, this article delves into Waterstone Financial Inc's dividend performance and assesses its sustainability.
Understanding Waterstone Financial Inc's Business Model
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Waterstone Financial Inc is a holding company that operates via its subsidiaries in two segments: Community Banking and Mortgage Banking. The Community Banking segment offers consumer and business banking products and services, including various types of loans, deposits, and personal investment services. The Mortgage Banking segment primarily focuses on residential mortgage loans for sale in the secondary market. The majority of the company's revenue stems from the community banking segment.
Exploring Waterstone Financial Inc's Dividend History
Waterstone Financial Inc has upheld a consistent dividend payment record since 2014, distributing dividends on a quarterly basis. The chart below provides a historical overview of the annual Dividends Per Share.
Analyzing Waterstone Financial Inc's Dividend Yield and Growth
Currently, Waterstone Financial Inc boasts a 12-month trailing dividend yield of 7.57% and a 12-month forward dividend yield of 5.66%, indicating an expected decrease in dividend payments over the next 12 months.
Over the past three years, Waterstone Financial Inc's annual dividend growth rate was 18.60%. When extended to a five-year horizon, this rate increased to 19.40% per year. Based on the company's dividend yield and five-year growth rate, the 5-year yield on cost of Waterstone Financial Inc stock as of today is approximately 18.37%.
Evaluating the Sustainability of Waterstone Financial Inc's Dividends
To determine the sustainability of Waterstone Financial Inc's dividends, it's crucial to examine the company's payout ratio. The dividend payout ratio reveals the percentage of earnings the company distributes as dividends. A lower ratio suggests that the company retains a significant portion of its earnings, which can be used for future growth and to weather unexpected downturns. As of 2023-06-30, Waterstone Financial Inc's dividend payout ratio is 1.67, which may indicate that the company's dividend may not be sustainable.
Waterstone Financial Inc's profitability rank, as determined by GuruFocus, offers insights into the company's earnings prowess relative to its peers. As of 2023-06-30, Waterstone Financial Inc's profitability ranks at 6 out of 10, suggesting fair profitability. The company has reported positive net income each year over the past decade, further solidifying its high profitability.
Assessing Waterstone Financial Inc's Growth Metrics and Future Outlook
For a company to sustain its dividends, robust growth metrics are essential. Waterstone Financial Inc's growth rank of 6 out of 10 suggests a fair growth outlook. The company's revenue per share and 3-year revenue growth rate indicate a strong revenue model, with an average annual increase of approximately 1.50%. However, this rate underperforms approximately 76.99% of global competitors.
Waterstone Financial Inc's 3-year EPS growth rate showcases its ability to grow its earnings, a critical factor for sustaining dividends in the long run. Over the past three years, the company's earnings increased by approximately -13.40% per year on average, a rate that underperforms approximately 92.62% of global competitors. Lastly, the company's 5-year EBITDA growth rate stands at 10.80%, which underperforms approximately 42.15% of global competitors.
Final Thoughts on Waterstone Financial Inc's Dividend Performance
While Waterstone Financial Inc has demonstrated a consistent dividend payment history and a high dividend yield, its high payout ratio and underperforming growth metrics raise concerns about the sustainability of its dividends. Investors should closely monitor these factors to make informed decisions. GuruFocus Premium users can screen for high-dividend yield stocks using the High Dividend Yield Screener.
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
This article first appeared on GuruFocus.
