Back to top

Image: Bigstock

Summit Financial (SMMF) Announces Dividend Hike, Stock Dips

Read MoreHide Full Article

Summit Financial Group, Inc. (SMMF - Free Report) hiked its quarterly cash dividend. The company’s board of directors announced a dividend of 20 cents per share, representing a hike of 11.1% from the prior payout. The dividend will be paid out on Sep 30, 2022, to stockholders of record as of Sep 15.

Since the announcement of the hike, shares of SMMF have lost 1.3%.

Considering the last day’s closing price, the company’s dividend yield currently stands at 2.8%. The yield is not only attractive to income investors but also represents a steady income stream.

Before this hike, SMMF announced a dividend hike of 5.9% in August 2021. The dividend was raised from 17 cents per share to 18 cents. The dividend was paid out on Sep 30, 2021, to shareholders of record as of Sep 15, 2021.

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

Summit Financial’s past performance depicts a robust earnings picture. Its earnings surpassed the Zacks Consensus Estimate in three of the trailing four quarters, with a surprise of 4.6%, on average. Over the last three-five years, SMMF’s earnings witnessed growth of 14.9%, 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 18.4%, whereas the projected earnings growth rate is 2.4% for 2023.

The company’s revenues have witnessed a compound annual growth rate of 12.7% over the last five years (2016-2021), with the uptrend continuing in the first half of 2022. The positive momentum is expected to continue in the near term. The company’s projected sales growth rates are 13.1% and 3.9% for 2022 and 2023, respectively.

Summit Financial’s return on equity (ROE) reflects its superiority in utilizing shareholders’ funds over its peers. Its ROE of 15.46% compares favorably with the industry average of 10.77%.

Further, SMMF stock looks undervalued right now when compared with the industry average. It currently has a price/book ratio of 1.16, below the industry’s 1.24. Also, its price/cash flow ratio of 7.04 compares favorably with the industry average of 8.88.

Looking at its price performance, shares of the company have gained 21.4% in the past year compared with the industry’s growth of 2.4%.

 

Zacks Investment Research
Image Source: Zacks Investment Research

 

Dividend Hikes Announced by Other Finance Companies

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 of 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 was 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 shares worth $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 >>

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

Summit Financial Group, Inc. (SMMF) - free report >>

Published in