Why You Might Be Interested In Northfield Bancorp, Inc. (Staten Island, NY) (NASDAQ:NFBK) For Its Upcoming Dividend
Northfield Bancorp, Inc. (Staten Island, NY) (NASDAQ:NFBK) is about to trade ex-dividend in the next four days. The ex-dividend date is one business day before a company's record date, which is the date on which the company determines which shareholders are entitled to receive a dividend. The ex-dividend date is an important date to be aware of as any purchase of the stock made on or after this date might mean a late settlement that doesn't show on the record date. This means that investors who purchase Northfield Bancorp (Staten Island NY)'s shares on or after the 8th of August will not receive the dividend, which will be paid on the 23rd of August.
The company's upcoming dividend is US$0.13 a share, following on from the last 12 months, when the company distributed a total of US$0.52 per share to shareholders. Calculating the last year's worth of payments shows that Northfield Bancorp (Staten Island NY) has a trailing yield of 4.4% on the current share price of $11.84. If you buy this business for its dividend, you should have an idea of whether Northfield Bancorp (Staten Island NY)'s dividend is reliable and sustainable. As a result, readers should always check whether Northfield Bancorp (Staten Island NY) has been able to grow its dividends, or if the dividend might be cut.
Check out our latest analysis for Northfield Bancorp (Staten Island NY)
If a company pays out more in dividends than it earned, then the dividend might become unsustainable - hardly an ideal situation. That's why it's good to see Northfield Bancorp (Staten Island NY) paying out a modest 45% of its earnings.
Companies that pay out less in dividends than they earn in profits generally have more sustainable dividends. The lower the payout ratio, the more wiggle room the business has before it could be forced to cut the dividend.
Click here to see the company's payout ratio, plus analyst estimates of its future dividends.
Have Earnings And Dividends Been Growing?
Businesses with strong growth prospects usually make the best dividend payers, because it's easier to grow dividends when earnings per share are improving. If earnings fall far enough, the company could be forced to cut its dividend. Fortunately for readers, Northfield Bancorp (Staten Island NY)'s earnings per share have been growing at 16% a year for the past five years.
Many investors will assess a company's dividend performance by evaluating how much the dividend payments have changed over time. Northfield Bancorp (Staten Island NY) has delivered an average of 8.0% per year annual increase in its dividend, based on the past 10 years of dividend payments. It's encouraging to see the company lifting dividends while earnings are growing, suggesting at least some corporate interest in rewarding shareholders.
The Bottom Line
Is Northfield Bancorp (Staten Island NY) worth buying for its dividend? Typically, companies that are growing rapidly and paying out a low fraction of earnings are keeping the profits for reinvestment in the business. This strategy can add significant value to shareholders over the long term - as long as it's done without issuing too many new shares. In summary, Northfield Bancorp (Staten Island NY) appears to have some promise as a dividend stock, and we'd suggest taking a closer look at it.
With that in mind, a critical part of thorough stock research is being aware of any risks that stock currently faces. In terms of investment risks, we've identified 1 warning sign with Northfield Bancorp (Staten Island NY) and understanding them should be part of your investment process.
A common investing mistake is buying the first interesting stock you see. Here you can find a full list of high-yield 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.
