Whether it's through stocks, bonds, ETFs, or other types of securities, all investors love seeing their portfolios score big returns. But for income investors, generating consistent cash flow from each of your liquid investments is your primary focus.
Cash flow can come from bond interest, interest from other types of investments, and of course, dividends. A dividend is the distribution of a company's earnings paid out to shareholders; it's often viewed by its dividend yield, a metric that measures a dividend as a percent of the current stock price. Many academic studies show that dividends make up large portions of long-term returns, and in many cases, dividend contributions surpass one-third of total returns.
Salisbury Bancorp in Focus
Based in Lakeville, Salisbury Bancorp is in the Finance sector, and so far this year, shares have seen a price change of 26.48%. The bank holding company is paying out a dividend of $0.3 per share at the moment, with a dividend yield of 2.55% compared to the Banks - Northeast industry's yield of 1.94% and the S&P 500's yield of 1.29%.
In terms of dividend growth, the company's current annualized dividend of $1.20 is up 3.4% from last year. Salisbury Bancorp has increased its dividend 1 times on a year-over-year basis over the last 5 years for an average annual increase of 0.79%. Looking ahead, future dividend growth will be dependent on earnings growth and payout ratio, which is the proportion of a company's annual earnings per share that it pays out as a dividend. Salisbury Bancorp's current payout ratio is 23%. This means it paid out 23% of its trailing 12-month EPS as dividend.
SAL is expecting earnings to expand this fiscal year as well. The Zacks Consensus Estimate for 2021 is $5.45 per share, representing a year-over-year earnings growth rate of 29.76%.
Bottom Line
Investors like dividends for many reasons; they greatly improve stock investing profits, decrease overall portfolio risk, and carry tax advantages, among others. But, not every company offers a quarterly payout.
Big, established firms that have more secure profits are often seen as the best dividend options, but it's fairly uncommon to see high-growth businesses or tech start-ups offer their stockholders a dividend. Income investors must be conscious of the fact that high-yielding stocks tend to struggle during periods of rising interest rates. That said, they can take comfort from the fact that SAL is not only an attractive dividend play, but is also a compelling investment opportunity with a Zacks Rank of #2 (Buy).
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This is Why Salisbury Bancorp (SAL) is a Great Dividend Stock
Whether it's through stocks, bonds, ETFs, or other types of securities, all investors love seeing their portfolios score big returns. But for income investors, generating consistent cash flow from each of your liquid investments is your primary focus.
Cash flow can come from bond interest, interest from other types of investments, and of course, dividends. A dividend is the distribution of a company's earnings paid out to shareholders; it's often viewed by its dividend yield, a metric that measures a dividend as a percent of the current stock price. Many academic studies show that dividends make up large portions of long-term returns, and in many cases, dividend contributions surpass one-third of total returns.
Salisbury Bancorp in Focus
Based in Lakeville, Salisbury Bancorp is in the Finance sector, and so far this year, shares have seen a price change of 26.48%. The bank holding company is paying out a dividend of $0.3 per share at the moment, with a dividend yield of 2.55% compared to the Banks - Northeast industry's yield of 1.94% and the S&P 500's yield of 1.29%.
In terms of dividend growth, the company's current annualized dividend of $1.20 is up 3.4% from last year. Salisbury Bancorp has increased its dividend 1 times on a year-over-year basis over the last 5 years for an average annual increase of 0.79%. Looking ahead, future dividend growth will be dependent on earnings growth and payout ratio, which is the proportion of a company's annual earnings per share that it pays out as a dividend. Salisbury Bancorp's current payout ratio is 23%. This means it paid out 23% of its trailing 12-month EPS as dividend.
SAL is expecting earnings to expand this fiscal year as well. The Zacks Consensus Estimate for 2021 is $5.45 per share, representing a year-over-year earnings growth rate of 29.76%.
Bottom Line
Investors like dividends for many reasons; they greatly improve stock investing profits, decrease overall portfolio risk, and carry tax advantages, among others. But, not every company offers a quarterly payout.
Big, established firms that have more secure profits are often seen as the best dividend options, but it's fairly uncommon to see high-growth businesses or tech start-ups offer their stockholders a dividend. Income investors must be conscious of the fact that high-yielding stocks tend to struggle during periods of rising interest rates. That said, they can take comfort from the fact that SAL is not only an attractive dividend play, but is also a compelling investment opportunity with a Zacks Rank of #2 (Buy).