Veritex Holdings (NASDAQ:VBTX) Is Due To Pay A Dividend Of $0.20
Veritex Holdings, Inc. (NASDAQ:VBTX) has announced that it will pay a dividend of $0.20 per share on the 24th of November. This means the dividend yield will be fairly typical at 4.7%.
Check out our latest analysis for Veritex Holdings
Veritex Holdings' Dividend Forecasted To Be Well Covered By Earnings
We aren't too impressed by dividend yields unless they can be sustained over time.
Veritex Holdings has a good history of paying out dividends, with its current track record at 5 years. Based on Veritex Holdings' last earnings report, the payout ratio is at a decent 30%, meaning that the company is able to pay out its dividend with a bit of room to spare.
Looking forward, EPS is forecast to rise by 5.5% over the next 3 years. Analysts forecast the future payout ratio could be 33% over the same time horizon, which is a number we think the company can maintain.
Veritex Holdings Doesn't Have A Long Payment History
Veritex Holdings' dividend has been pretty stable for a little while now, but we will continue to be cautious until it has been demonstrated for a few more years. The dividend has gone from an annual total of $0.50 in 2018 to the most recent total annual payment of $0.80. This works out to be a compound annual growth rate (CAGR) of approximately 9.9% a year over that time. Veritex Holdings has been growing its dividend at a decent rate, and the payments have been stable. However, the payment history is very short, so there is no evidence yet that the dividend can be sustained over a full economic cycle.
The Dividend Looks Likely To Grow
Some investors will be chomping at the bit to buy some of the company's stock based on its dividend history. Veritex Holdings has seen EPS rising for the last five years, at 14% per annum. Veritex Holdings definitely has the potential to grow its dividend in the future with earnings on an uptrend and a low payout ratio.
Veritex Holdings Looks Like A Great Dividend Stock
Overall, we like to see the dividend staying consistent, and we think Veritex Holdings might even raise payments in the future. The company is easily earning enough to cover its dividend payments and it is great to see that these earnings are being translated into cash flow. 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. At the same time, there are other factors our readers should be conscious of before pouring capital into a stock. For example, we've identified 2 warning signs for Veritex Holdings (1 is potentially serious!) that you should be aware of before investing. Is Veritex Holdings not quite the opportunity you were looking for? Why not check out our selection of top dividend stocks.
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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.
