There is a lot to be liked about Glacier Bancorp Inc (NASDAQ:GBCI) as an income stock, over the past 10 years it has returned an average of 3.0% per year. The company currently pays out a dividend yield of 3.0% to shareholders, making it a relatively attractive dividend stock. Should it have a place in your portfolio? Let’s take a look at Glacier Bancorp in more detail.
5 checks you should use to assess a dividend stock
Whenever I am looking at a potential dividend stock investment, I always check these five metrics:
- Is its annual yield among the top 25% of dividend-paying companies?
- Has its dividend been stable over the past (i.e. no missed payments or significant payout cuts)?
- Has dividend per share amount increased over the past?
- Can it afford to pay the current rate of dividends from its earnings?
- Will the company be able to keep paying dividend based on the future earnings growth?
How well does Glacier Bancorp fit our criteria?
Glacier Bancorp has a trailing twelve-month payout ratio of 54.4%, meaning the dividend is sufficiently covered by earnings. However, going forward, analysts expect GBCI’s payout to fall to 48.0% of its earnings, which leads to a dividend yield of 2.4%. However, EPS should increase to $2.32, meaning that the lower payout ratio does not necessarily implicate a lower dividend payment.
If there’s one type of stock you want to be reliable, it’s dividend stocks and their stable income-generating ability. In the case of GBCI it has increased its DPS from $0.52 to $1.34 in the past 10 years. It has also been paying out dividend consistently during this time, as you’d expect for a company increasing its dividend levels. This is an impressive feat, which makes GBCI a true dividend rockstar.
Compared to its peers, Glacier Bancorp has a yield of 3.0%, which is high for Banks stocks but still below the market’s top dividend payers.
With this in mind, I definitely rank Glacier Bancorp as a strong dividend stock, and makes it worth further research for anyone who likes steady income generation from their portfolio. Given that this is purely a dividend analysis, I urge potential investors to try and get a good understanding of the underlying business and its fundamentals before deciding on an investment. Below, I’ve compiled three pertinent factors you should look at:
- Future Outlook: What are well-informed industry analysts predicting for GBCI’s future growth? Take a look at our free research report of analyst consensus for GBCI’s outlook.
- Valuation: What is GBCI worth today? Even if the stock is a cash cow, it’s not worth an infinite price. The intrinsic value infographic in our free research report helps visualize whether GBCI is currently mispriced by the market.
- Other Dividend Rockstars: Are there better dividend payers with stronger fundamentals out there? Check out our free list of these great stocks here.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at email@example.com.