Pinnacle Financial Partners Co., Ltd. (NASDAQ:PNFP) announced that it will pay a dividend of $0.22 per share on May 31st. This payment results in a dividend yield of 1.1%, which is below the industry average.
Check out our latest analysis for Pinnacle Financial Partners.
Pinnacle Financial Partners payout expected to cover solid earnings
Although the dividend yield is a bit low, sustainability of payments is also an important part of evaluating income stocks.
Pinnacle Financial Partners has a long history of paying dividends, with a current track record of at least 10 years. The company's payout ratio of 13% also indicates that Pinnacle Financial Partners is comfortable paying dividends, although past performance is not necessarily reflective of future performance.
Over the next three years, EPS is projected to expand by 53.5%. Analysts predict that the future payout ratio could be 11% over the same period, and we think this number can be maintained.
Pinnacle Financial Partners has a proven track record
The company has been paying dividends for a long time and is very stable, so we are confident in its future dividend potential. Over the past 10 years, his annual payments were $0.32 in 2014, and his most recent fiscal year payments were $0.88. This works out to be a compound annual growth rate (CAGR) of approximately 11% over that period. It's good to see that the dividend has been growing significantly and hasn't been cut for a long time.
Dividends have growth potential
Investors may be attracted to a stock based on the quality of its payment history. It's encouraging to see that Pinnacle Financial Partners has grown its earnings per share at 7.8% per year over the last five years. Pinnacle Financial Partners definitely has the potential to increase its dividend in the future, as its earnings are on the rise and its payout ratio is low.
Pinnacle Financial Partners looks like a high dividend stock
Overall, we think this is a great return investment, and think it may have been a conservative choice to maintain the dividend this year. Profits easily cover distributions, and the company generates a lot of cash. Taking all of this into account, this seems like a good dividend opportunity.
It's important to note that companies with a consistent dividend policy generate greater investor confidence than companies with an erratic dividend policy. On the other hand, despite the importance of dividends, they are not the only factor that our readers need to know when evaluating a company. For example, we chose 1 warning sign for Pinnacle Financial Partners Here's what investors should know before putting money into this stock. If you are a dividend investor, check out this article as well. A carefully selected list of high dividend stocks.
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This article by Simply Wall St is general in nature. We provide commentary using only unbiased methodologies, based on historical data and analyst forecasts, and articles are not intended to be financial advice. This is not a recommendation to buy or sell any stock, and does not take into account your objectives or financial situation. We aim to provide long-term, focused analysis based on fundamental data. Note that our analysis may not factor in the latest announcements or qualitative material from price-sensitive companies. Simply Wall St has no position in any stocks mentioned.
