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Whether it's through stocks, bonds, ETFs, or other types of securities, all investors love seeing their portfolios score big returns. But 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 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.
Headquartered in San Juan, First BanCorp (FBP - Free Report) is a Finance stock that has seen a price change of 35.12% so far this year. The holding company for FirstBank Puerto Rico is paying out a dividend of $0.20 per share at the moment, with a dividend yield of 2.86% compared to the Banks - Foreign industry's yield of 2.49% and the S&P 500's yield of 1.34%.
Looking at dividend growth, the company's current annualized dividend of $0.80 is up 11.1% from last year. Over the last 5 years, First BanCorp has increased its dividend 5 times on a year-over-year basis for an average annual increase of 29.65%. 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 BanCorp's current payout ratio is 36%, meaning it paid out 36% of its trailing 12-month EPS as dividend.
FBP is expecting earnings to expand this fiscal year as well. The Zacks Consensus Estimate for 2026 is $2.40 per share, with earnings expected to increase 18.23% from the year ago period.
From greatly improving stock investing profits and reducing overall portfolio risk to providing tax advantages, investors like dividends for a variety of different reasons. But, not every company offers a quarterly payout.
For instance, it's a rare occurrence when a tech start-up or big growth business offers its shareholders a dividend. It's more common to see larger companies with more established profits give out dividends. 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 FBP is not only an attractive dividend play, but also represents a compelling investment opportunity with a Zacks Rank of #2 (Buy).
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Whether it's through stocks, bonds, ETFs, or other types of securities, all investors love seeing their portfolios score big returns. But 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 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.
Headquartered in San Juan, First BanCorp (FBP - Free Report) is a Finance stock that has seen a price change of 35.12% so far this year. The holding company for FirstBank Puerto Rico is paying out a dividend of $0.20 per share at the moment, with a dividend yield of 2.86% compared to the Banks - Foreign industry's yield of 2.49% and the S&P 500's yield of 1.34%.
Looking at dividend growth, the company's current annualized dividend of $0.80 is up 11.1% from last year. Over the last 5 years, First BanCorp has increased its dividend 5 times on a year-over-year basis for an average annual increase of 29.65%. 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 BanCorp's current payout ratio is 36%, meaning it paid out 36% of its trailing 12-month EPS as dividend.
FBP is expecting earnings to expand this fiscal year as well. The Zacks Consensus Estimate for 2026 is $2.40 per share, with earnings expected to increase 18.23% from the year ago period.
From greatly improving stock investing profits and reducing overall portfolio risk to providing tax advantages, investors like dividends for a variety of different reasons. But, not every company offers a quarterly payout.
For instance, it's a rare occurrence when a tech start-up or big growth business offers its shareholders a dividend. It's more common to see larger companies with more established profits give out dividends. 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 FBP is not only an attractive dividend play, but also represents a compelling investment opportunity with a Zacks Rank of #2 (Buy).