Back to top

Image: Bigstock

Stock Yards Bancorp (SYBT) Hikes Dividend by 3.6%: Worth a Look?

Read MoreHide Full Article

Stock Yards Bancorp, Inc. (SYBT - Free Report) hiked its quarterly cash dividend. The company’s board of directors announced a dividend of 29 cents per share, representing a hike of 3.6% from the prior payout. The dividend will be paid out on Oct 3, 2022, to stockholders of record as of Sep 19, 2022.

James A. (Ja) Hillebrand, the chairman and CEO of SYBT, said, “With the strength of our earnings and solid capital position, we are pleased to increase our cash dividend rate as part of our continued efforts to provide returns to our loyal shareholders. The increased dividend highlights our Company’s stellar performance throughout the past year and the attractive growth opportunities we see ahead.”

Considering the previous day’s closing price, the company’s dividend yield currently stands at 1.6%. The yield is not only attractive to income investors but also represents a steady income stream.

SYBT has a track record of consistently raising dividends. Since 2012, the company has hiked its dividend 15 times.

Before this hike, SYBT increased its quarterly dividend by 3.7% from 27 cents per share to 28 cents in September 2021. The dividend was paid out on Oct 1, 2021, to shareholders of record as of Sep 20, 2021.

Investors interested in this Zacks Rank #3 (Hold) stock can have a look at its fundamentals and growth opportunities. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Stock Yards Bancorp’s past performance depicts a robust earnings picture. Its earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, with a surprise of 10.9%, on average. Over the last three-five years, SYBT’s earnings witnessed growth of 15.3%, higher than the industry average of 13.6%. The upward momentum is expected to continue in the near term. In 2022, the company’s earnings are projected to grow 1.1% while in 2023, the projected earnings growth rate is 0.2%.

The company’s revenues have witnessed a compound annual growth rate of 10.9% over the last six years (2016-2021). The uptrend is expected to continue in the near term as reflected by the company’s projected sales growth rates of 31.6% and 9.1% for 2022 and 2023, respectively.

Moreover, SYBT currently has a debt/equity ratio of 0.03, lower than the industry average of 0.15. This shows that the company will be more financially stable than its peers even in adverse economic conditions.

Further, the company’s return on equity (ROE) reflects its superiority in utilizing shareholders’ funds as compared to peers. Its ROE of 14.46% compares favorably with the industry average of 10.86%.

However, SYBT stock looks overvalued right now when compared with the industry average. It currently has a price/book ratio of 2.80, above the industry’s 1.29. Also, its price/cash flow ratio of 17.96 compares unfavorably with the industry average of 9.35.

Looking at its price performance, shares of the company have gained 43.3% in the past year compared with the industry’s growth of 13%.
 

Zacks Investment Research
Image Source: Zacks Investment Research

Dividend Hikes Announced by Other Finance Companies

Recently, Essent Group Ltd. (ESNT - Free Report) announced that its board of directors sequentially hiked the quarterly cash dividend by 4.8% to 22 cents per common share. The dividend will be paid out on Sep 12 to shareholders of record as of Sep 1, 2022.

Notably, Essent Group has ample liquidity and financial flexibility, with $619 million in cash and available investment for sale and $400 million unused credit facility capacity. A fortified balance sheet might aid ESNT in continuing dividend payments.

The Charles Schwab Corporation (SCHW - Free Report) declared a quarterly cash dividend of 22 cents per share, marking a 10% increase from the prior payout. The dividend will be paid out on Aug 26 to shareholders of record as of Aug 12, 2022.

Apart from the dividend hike, Schwab replaced its previous share repurchase program of $1.8 billion and is now authorized to repurchase a total of $15 billion under the new program. As of Jun 30, 2022, SCHW had 1.904 billion weighted-average common and common equivalent shares outstanding.


In-Depth Zacks Research for the Tickers Above


Normally $25 each - click below to receive one report FREE:


The Charles Schwab Corporation (SCHW) - free report >>

Stock Yards Bancorp, Inc. (SYBT) - free report >>

Essent Group Ltd. (ESNT) - free report >>

Published in