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Are You Looking for a High-Growth Dividend Stock?

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All investors love getting big returns from their portfolio, whether it's through stocks, bonds, ETFs, or other types of securities. But for income investors, generating consistent cash flow from each of your liquid investments is your primary focus.

While cash flow can come from bond interest or interest from other types of investments, income investors hone in on 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 account for significant portions of long-term returns, with dividend contributions exceeding one-third of total returns in many cases.

SB Financial Group, Inc. (SBFG - Free Report) is headquartered in Defiance, and is in the Finance sector. The stock has seen a price change of 2.38% since the start of the year. Currently paying a dividend of $0.16 per share, the company has a dividend yield of 2.72%. In comparison, the Banks - Northeast industry's yield is 2.3%, while the S&P 500's yield is 1.43%.

Looking at dividend growth, the company's current annualized dividend of $0.62 is up 3.3% from last year. Over the last 5 years, SB Financial Group, Inc. has increased its dividend 5 times on a year-over-year basis for an average annual increase of 9.81%. 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. SB Financial Group's current payout ratio is 24%, meaning it paid out 24% of its trailing 12-month EPS as dividend.

Looking at this fiscal year, SBFG expects solid earnings growth. The Zacks Consensus Estimate for 2026 is $2.53 per share, which represents a year-over-year growth rate of 9.52%.

Investors like dividends for a variety of different reasons, from tax advantages and decreasing overall portfolio risk to considerably improving stock investing profits. However, not all companies offer 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. During periods of rising interest rates, income investors must be mindful that high-yielding stocks tend to struggle. That said, they can take comfort from the fact that SBFG 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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