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Why First Guaranty Bancshares (FGBI) is a Great Dividend Stock Right Now
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Getting big returns from financial portfolios, whether through stocks, bonds, ETFs, other securities, or a combination of all, is an investor's dream. However, when you're an income investor, your primary focus is generating consistent cash flow from each of your liquid investments.
Cash flow can come from bond interest, interest from other types of investments, and of course, dividends. A dividend is that coveted distribution of a company's earnings paid out to shareholders, and investors often view it by its dividend yield, a metric that measures the 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.
First Guaranty Bancshares in Focus
First Guaranty Bancshares (FGBI - Free Report) is headquartered in Hammond, and is in the Finance sector. The stock has seen a price change of 17.22% since the start of the year. The bank holding company is currently shelling out a dividend of $0.16 per share, with a dividend yield of 2.68%. This compares to the Banks - Southeast industry's yield of 2.18% and the S&P 500's yield of 1.72%.
Taking a look at the company's dividend growth, its current annualized dividend of $0.64 is up 7.4% from last year. In the past five-year period, First Guaranty Bancshares has increased its dividend 2 times on a year-over-year basis for an average annual increase of 2.09%. 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. First Guaranty Bancshares's current payout ratio is 25%, meaning it paid out 25% of its trailing 12-month EPS as dividend.
FGBI is expecting earnings to expand this fiscal year as well. The Zacks Consensus Estimate for 2022 is $2.70 per share, with earnings expected to increase 11.57% from the year ago period.
Bottom Line
From greatly improving stock investing profits and reducing overall portfolio risk to providing tax advantages, investors like dividends for a variety of different reasons. It's important to keep in mind that not all companies provide 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. With that in mind, FGBI presents a compelling investment opportunity; it's not only an attractive dividend play, but the stock also boasts a strong Zacks Rank of #2 (Buy).
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Why First Guaranty Bancshares (FGBI) is a Great Dividend Stock Right Now
Getting big returns from financial portfolios, whether through stocks, bonds, ETFs, other securities, or a combination of all, is an investor's dream. However, when you're an income investor, your primary focus is generating consistent cash flow from each of your liquid investments.
Cash flow can come from bond interest, interest from other types of investments, and of course, dividends. A dividend is that coveted distribution of a company's earnings paid out to shareholders, and investors often view it by its dividend yield, a metric that measures the 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.
First Guaranty Bancshares in Focus
First Guaranty Bancshares (FGBI - Free Report) is headquartered in Hammond, and is in the Finance sector. The stock has seen a price change of 17.22% since the start of the year. The bank holding company is currently shelling out a dividend of $0.16 per share, with a dividend yield of 2.68%. This compares to the Banks - Southeast industry's yield of 2.18% and the S&P 500's yield of 1.72%.
Taking a look at the company's dividend growth, its current annualized dividend of $0.64 is up 7.4% from last year. In the past five-year period, First Guaranty Bancshares has increased its dividend 2 times on a year-over-year basis for an average annual increase of 2.09%. 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. First Guaranty Bancshares's current payout ratio is 25%, meaning it paid out 25% of its trailing 12-month EPS as dividend.
FGBI is expecting earnings to expand this fiscal year as well. The Zacks Consensus Estimate for 2022 is $2.70 per share, with earnings expected to increase 11.57% from the year ago period.
Bottom Line
From greatly improving stock investing profits and reducing overall portfolio risk to providing tax advantages, investors like dividends for a variety of different reasons. It's important to keep in mind that not all companies provide 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. With that in mind, FGBI presents a compelling investment opportunity; it's not only an attractive dividend play, but the stock also boasts a strong Zacks Rank of #2 (Buy).