Yahoo Finance Princeton Bancorp (NASDAQ:BPRN) Will Pay A Larger Dividend Than Last Year At $0.30
Princeton Bancorp, Inc.'s (NASDAQ:BPRN) dividend will be increasing from last year's payment of the same period to $0.30 on 26th of May. This makes the dividend yield about the same as the industry average at 3.8%.
View our latest analysis for Princeton Bancorp
Princeton Bancorp's Earnings Will Easily Cover The Distributions
Solid dividend yields are great, but they only really help us if the payment is sustainable.
Princeton Bancorp is just starting to establish itself as being able to pay dividends to shareholders, given its short 4-year history of distributing earnings. Based on its last earnings report however, the payout ratio is at a comfortable 18%, meaning that Princeton Bancorp may be able to sustain this dividend for future years if it continues on this earnings trend.
Over the next year, EPS could expand by 17.1% if recent trends continue. If the dividend continues on this path, the future payout ratio could be 33% by next year, which we think can be pretty sustainable going forward.
Princeton Bancorp Is Still Building Its Track Record
The company has maintained a consistent dividend for a few years now, but we would like to see a longer track record before relying on it. Since 2019, the annual payment back then was $0.12, compared to the most recent full-year payment of $1.20. This means that it has been growing its distributions at 78% per annum over that time. Princeton Bancorp has been growing its dividend quite rapidly, which is exciting. However, the short payment history makes us question whether this performance will persist across a full market cycle.
The Dividend Looks Likely To Grow
Investors could be attracted to the stock based on the quality of its payment history. Princeton Bancorp has impressed us by growing EPS at 17% per year over the past five years. Growth in EPS bodes well for the dividend, as does the low payout ratio that the company is currently reporting.
We Really Like Princeton Bancorp's Dividend
Overall, a dividend increase is always good, and we think that Princeton Bancorp is a strong income stock thanks to its track record and growing earnings. Distributions are quite easily covered by earnings, which are also being converted to cash flows. Taking this all into consideration, this looks like it could be a good dividend opportunity.
Market movements attest to how highly valued a consistent dividend policy is compared to one which is more unpredictable. Still, investors need to consider a host of other factors, apart from dividend payments, when analysing a company. As an example, we've identified 1 warning sign for Princeton Bancorp that you should be aware of before investing. If you are a dividend investor, you might also want to look at our curated 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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