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Huntington (HBAN) Stock May Be Retained for Dividend Yield
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Huntington Bancshares (HBAN - Free Report) is one solid dividend-yielding stock that investors prefer to retain in their portfolios amid ongoing turmoil of the banking industry and hovering recession fears in the near term.
Headquartered in Columbus, OH, this multi-state diversified regional bank, through its banking subsidiary, The Huntington National Bank, provides a comprehensive suite of banking, payments, wealth management, and risk management products and services.
HBAN has been paying its quarterly dividends on a regular basis along with raising it occasionally. The last hike of 3.3% to 15.5 cents per share was announced in October 2021. Over the past five years, it increased dividends thrice, with an annualized dividend growth rate of 3.83%.
Considering last day’s closing price of $10.04 per share, the company’s current dividend yield is 6.17%. This is impressive compared with the industry’s average of 3.79% and attracts investors as it represents a steady income stream.
HBAN also has a steady share repurchase program in place. In January 2023, the company’s board authorized repurchase of common shares worth $1 billion till Dec 31, 2024.
However, it did not repurchase shares under the current authorization in the first three months of 2023. Also, management does not expect to utilize this program in the current year as part of its 2023 plan to improve its capital position.
Huntington, one of the top 30 bank holding companies in the United States, remains focused on acquiring the industry's best deposit franchise. Its total deposits witnessed a rise in four-year compounded annual growth rate (CAGR) in 2022. The rising trend continued in first-quarter 2023 as well.
Loan balance recorded a rise in four-year CAGR during the same period. The uptrend continued in the first quarter of 2023.
Given the strength in loans and deposits, the balance sheet is poised to grow. Management expects average loans to grow 5-7% in 2023.
Net-interest income (NII) and net interest margin (NIM) increased in 2022. Federal Reserve is raising interest rates and growth in interest earning assets is witnessed. On the back of this, Huntington’s NII and the yield on interest-earning assets are expected to register decent growth.
The company is projecting 2023 NII (excluding Paycheck Protection Program or PPP and Purchase Accounting Accretion) growth of 6-9%, aided by higher earning assets and modest NIM expansion.
On the flipside, weak mortgage business due to higher rates is expected to ail fee income in the near term. Further, rising costs may hinder bottom-line growth. Also, loan concentration, comprising 57% of commercial loans in the total loan portfolio, is concerning.
Nonetheless, a solid balance-sheet position and expansion efforts are likely to support HBAN’s growth.
Over the past three months, shares of HBAN have lost 34.8% compared with the industry’s fall of 31.2%.
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 have robust dividend yields.
Considering the last day’s closing price of $15.35 per share, ASB’s current dividend yield is 5.47%. Over the past six months, the shares of ASB have lost 36.1%.
Based on the last day’s closing price of $15.07 per share, IVZ’s present dividend yield is 5.3%. Over the past six months, the shares of IVZ have lost 19.6%.
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Huntington (HBAN) Stock May Be Retained for Dividend Yield
Huntington Bancshares (HBAN - Free Report) is one solid dividend-yielding stock that investors prefer to retain in their portfolios amid ongoing turmoil of the banking industry and hovering recession fears in the near term.
Headquartered in Columbus, OH, this multi-state diversified regional bank, through its banking subsidiary, The Huntington National Bank, provides a comprehensive suite of banking, payments, wealth management, and risk management products and services.
HBAN has been paying its quarterly dividends on a regular basis along with raising it occasionally. The last hike of 3.3% to 15.5 cents per share was announced in October 2021. Over the past five years, it increased dividends thrice, with an annualized dividend growth rate of 3.83%.
Considering last day’s closing price of $10.04 per share, the company’s current dividend yield is 6.17%. This is impressive compared with the industry’s average of 3.79% and attracts investors as it represents a steady income stream.
Huntington Bancshares Incorporated Dividend Yield (TTM)
Huntington Bancshares Incorporated dividend-yield-ttm | Huntington Bancshares Incorporated Quote
HBAN also has a steady share repurchase program in place. In January 2023, the company’s board authorized repurchase of common shares worth $1 billion till Dec 31, 2024.
However, it did not repurchase shares under the current authorization in the first three months of 2023. Also, management does not expect to utilize this program in the current year as part of its 2023 plan to improve its capital position.
Huntington, one of the top 30 bank holding companies in the United States, remains focused on acquiring the industry's best deposit franchise. Its total deposits witnessed a rise in four-year compounded annual growth rate (CAGR) in 2022. The rising trend continued in first-quarter 2023 as well.
Loan balance recorded a rise in four-year CAGR during the same period. The uptrend continued in the first quarter of 2023.
Given the strength in loans and deposits, the balance sheet is poised to grow. Management expects average loans to grow 5-7% in 2023.
Net-interest income (NII) and net interest margin (NIM) increased in 2022. Federal Reserve is raising interest rates and growth in interest earning assets is witnessed. On the back of this, Huntington’s NII and the yield on interest-earning assets are expected to register decent growth.
The company is projecting 2023 NII (excluding Paycheck Protection Program or PPP and Purchase Accounting Accretion) growth of 6-9%, aided by higher earning assets and modest NIM expansion.
On the flipside, weak mortgage business due to higher rates is expected to ail fee income in the near term. Further, rising costs may hinder bottom-line growth. Also, loan concentration, comprising 57% of commercial loans in the total loan portfolio, is concerning.
Nonetheless, a solid balance-sheet position and expansion efforts are likely to support HBAN’s growth.
Over the past three months, shares of HBAN have lost 34.8% compared with the industry’s fall of 31.2%.
Image Source: Zacks Investment Research
HBAN currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Finance Stocks Worth Considering
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 have robust dividend yields.
Considering the last day’s closing price of $15.35 per share, ASB’s current dividend yield is 5.47%. Over the past six months, the shares of ASB have lost 36.1%.
Based on the last day’s closing price of $15.07 per share, IVZ’s present dividend yield is 5.3%. Over the past six months, the shares of IVZ have lost 19.6%.