Yahoo Finance Community Bank System, Inc. (NYSE:CBU) Will Pay A US$0.44 Dividend In Four Days
Readers hoping to buy Community Bank System, Inc. (NYSE:CBU) for its dividend will need to make their move shortly, as the stock is about to trade ex-dividend. Typically, the ex-dividend date is one business day before the record date which is the date on which a company determines the shareholders eligible to receive a dividend. The ex-dividend date is of consequence because whenever a stock is bought or sold, the trade takes at least two business day to settle. This means that investors who purchase Community Bank System's shares on or after the 14th of December will not receive the dividend, which will be paid on the 10th of January.
The company's next dividend payment will be US$0.44 per share, and in the last 12 months, the company paid a total of US$1.76 per share. Calculating the last year's worth of payments shows that Community Bank System has a trailing yield of 2.8% on the current share price of $62.13. If you buy this business for its dividend, you should have an idea of whether Community Bank System's dividend is reliable and sustainable. So we need to investigate whether Community Bank System can afford its dividend, and if the dividend could grow.
View our latest analysis for Community Bank System
If a company pays out more in dividends than it earned, then the dividend might become unsustainable - hardly an ideal situation. Community Bank System paid out more than half (52%) of its earnings last year, which is a regular payout ratio for most companies.
When a company paid out less in dividends than it earned in profit, this generally suggests its dividend is affordable. The lower the % of its profit that it pays out, the greater the margin of safety for the dividend if the business enters a downturn.
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. With that in mind, we're encouraged by the steady growth at Community Bank System, with earnings per share up 7.3% on average over the last five years.
Many investors will assess a company's dividend performance by evaluating how much the dividend payments have changed over time. Community Bank System has delivered 5.4% dividend growth per year on average over the past 10 years. It's encouraging to see the company lifting dividends while earnings are growing, suggesting at least some corporate interest in rewarding shareholders.
To Sum It Up
Has Community Bank System got what it takes to maintain its dividend payments? Community Bank System has been generating some growth in earnings per share while paying out more than half of its earnings to shareholders in the form of dividends. We think there are likely better opportunities out there.
Curious what other investors think of Community Bank System? See what analysts are forecasting, with this visualisation of its historical and future estimated earnings and cash flow.
A common investing mistake is buying the first interesting stock you see. Here you can find a full list of high-yield 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.
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