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Should You Watch Community Trust (CTBI) for Solid Dividend?
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Amid the current tough operating backdrop (expectations of an economic slowdown/recession), the financial sector is deteriorating. Hence, solid dividend-yielding stocks should be on investors’ radar. Today, we are discussing one such stock, Community Trust Bancorp, Inc. (CTBI - Free Report) .
It has been increasing its quarterly dividend regularly, with the latest hike of 10% to 44 cents per share announced in July 2022. Over the past five years, the company raised its dividend five times, with an annualized dividend growth rate of 4.72%.
Considering last day’s closing price of $35.77 per share, CTBI’s current dividend yield is 4.92%. This is impressive compared with the industry’s average of 3.09% and attractive for investors as it represents a steady income stream.
Is the CTBI stock worth a look to earn a high dividend yield? Let’s check the company’s fundamentals to understand its risks and rewards for making a proper investment decision.
Community Trust Bancorp, Inc. Dividend Yield (TTM)
Community Trust exhibits strong liquidity. The company maintains liquid assets in the form of cash and cash equivalents and investment securities. The sufficient unused borrowing capacity and growth in core deposits also add to the liquidity profile of the company.
As of March 31, 2023, it had cash and cash equivalents of $235.9 million and unpledged securities valued at estimated fair value of $286.4 million. Also, it had an available borrowing position with the Federal Home Loan Bank of $517.6 million. Such higher level of liquidity makes the long-term debt of $64 million as on the same date seem manageable.
Organic growth remains a key strength at Community Trust, with net interest income (NII) rising over the years. The high interest-rate environment and strong lending pipeline are expected to support its NII and net interest margin in the upcoming period.
CTBI’s balance sheet growth has been supported by an increase in loans. Over the past five years (ended 2022), the company’s net loans witnessed a compound annual growth rate of 3.7%, with the uptrend continuing in first-quarter 2023.
On the flip side, Community Trust’s bottom line continues to suffer from rising costs. Also, a deteriorating credit quality and a lack of diversification in the loan portfolio are concerning.
Over the past three months, shares of CTBI have lost 5% compared with the industry’s fall of 0.1%.
A couple of other finance stocks, like Associated Banc-Corp (ASB - Free Report) and Invesco Ltd. (IVZ - Free Report) , are worth a look as these too have robust dividend yields.
Considering the last day’s closing price of $16.14 per share, ASB’s current dividend yield is 5.2%. Over the past six months, the stock has declined 30.1%.
Based on the last day’s closing price of $16.56 per share, IVZ’s present dividend yield is 4.83%. Over the past six months, the stock has lost 8%.
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Should You Watch Community Trust (CTBI) for Solid Dividend?
Amid the current tough operating backdrop (expectations of an economic slowdown/recession), the financial sector is deteriorating. Hence, solid dividend-yielding stocks should be on investors’ radar. Today, we are discussing one such stock, Community Trust Bancorp, Inc. (CTBI - Free Report) .
It has been increasing its quarterly dividend regularly, with the latest hike of 10% to 44 cents per share announced in July 2022. Over the past five years, the company raised its dividend five times, with an annualized dividend growth rate of 4.72%.
Considering last day’s closing price of $35.77 per share, CTBI’s current dividend yield is 4.92%. This is impressive compared with the industry’s average of 3.09% and attractive for investors as it represents a steady income stream.
Is the CTBI stock worth a look to earn a high dividend yield? Let’s check the company’s fundamentals to understand its risks and rewards for making a proper investment decision.
Community Trust Bancorp, Inc. Dividend Yield (TTM)
Community Trust Bancorp, Inc. dividend-yield-ttm | Community Trust Bancorp, Inc. Quote
Community Trust exhibits strong liquidity. The company maintains liquid assets in the form of cash and cash equivalents and investment securities. The sufficient unused borrowing capacity and growth in core deposits also add to the liquidity profile of the company.
As of March 31, 2023, it had cash and cash equivalents of $235.9 million and unpledged securities valued at estimated fair value of $286.4 million. Also, it had an available borrowing position with the Federal Home Loan Bank of $517.6 million. Such higher level of liquidity makes the long-term debt of $64 million as on the same date seem manageable.
Organic growth remains a key strength at Community Trust, with net interest income (NII) rising over the years. The high interest-rate environment and strong lending pipeline are expected to support its NII and net interest margin in the upcoming period.
CTBI’s balance sheet growth has been supported by an increase in loans. Over the past five years (ended 2022), the company’s net loans witnessed a compound annual growth rate of 3.7%, with the uptrend continuing in first-quarter 2023.
On the flip side, Community Trust’s bottom line continues to suffer from rising costs. Also, a deteriorating credit quality and a lack of diversification in the loan portfolio are concerning.
Over the past three months, shares of CTBI have lost 5% compared with the industry’s fall of 0.1%.
Image Source: Zacks Investment Research
CTBI currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
A couple of other finance stocks, like Associated Banc-Corp (ASB - Free Report) and Invesco Ltd. (IVZ - Free Report) , are worth a look as these too have robust dividend yields.
Considering the last day’s closing price of $16.14 per share, ASB’s current dividend yield is 5.2%. Over the past six months, the stock has declined 30.1%.
Based on the last day’s closing price of $16.56 per share, IVZ’s present dividend yield is 4.83%. Over the past six months, the stock has lost 8%.