Richmond Mutual Bancorporation, Inc.( NASDAQ:RMBI ) will pay a dividend of $0.15 on the 18th of December. The dividend yield will be 4.5% based on this payment which is still above the industry average.
Richmond Mutual Bancorporation's Dividend Forecasted To Be Well Covered By Earnings
We like to see robust dividend yields, but that doesn't matter if the payment isn't sustainable.
Richmond Mutual Bancorporation has a good history of paying out dividends, with its current track record at 6 years. Taking data from its last earnings report, calculating for the company's payout ratio of 54%shows that Richmond Mutual Bancorporation would be able to pay its last dividend without pressure on the balance sheet.
If the trend of the last few years continues, EPS will grow by 8.4% over the next 12 months. If the dividend continues along recent trends, we estimate the future payout ratio will be 63%, which is in the range that makes us comfortable with the sustainability of the dividend.
View our latest analysis for Richmond Mutual Bancorporation
Richmond Mutual Bancorporation Is Still Building Its Track Record
The dividend's track record has been pretty solid, but with only 6 years of history we want to see a few more years of history before making any solid conclusions. The dividend has gone from an annual total of $0.20 in 2019 to the most recent total annual payment of $0.60. This means that it has been growing its distributions at 20% per annum over that time. The dividend has been growing rapidly, however with such a short payment history we can't know for sure if payment can continue to grow over the long term, so caution may be warranted.
Richmond Mutual Bancorporation Could Grow Its Dividend
Some investors will be chomping at the bit to buy some of the company's stock based on its dividend history. Richmond Mutual Bancorporation has seen EPS rising for the last five years, at 8.4% per annum. Shareholders are getting plenty of the earnings returned to them, which combined with strong growth makes this quite appealing.
Richmond Mutual Bancorporation Looks Like A Great Dividend Stock
In summary, it is good to see that the dividend is staying consistent, and we don't think there is any reason to suspect this might change over the medium term. Earnings are easily covering distributions, and the company is generating plenty of cash. All of these factors considered, we think this has solid potential as a dividend stock.
It's important to note that companies having a consistent dividend policy will generate greater investor confidence than those having an erratic one. At the same time, there are other factors our readers should be conscious of before pouring capital into a stock. Now, if you want to look closer, it would be worth checking out our freeresearch on Richmond Mutual Bancorporation management tenure , salary, and performance. If you are a dividend investor, you might also want to look at our curated list of high yield dividend stocks.
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