Examining the Dividend History, Yield, Growth, and Future Prospects of Heartland Bancorp
Heartland Bancorp (HLAN, Financial) recently announced a dividend of $0.76 per share, payable on 2023-10-10, with the ex-dividend date set for 2023-09-22. As investors look forward to this upcoming payment, the spotlight also shines on the company's dividend history, yield, and growth rates. Using the data from GuruFocus, let's deep dive into Heartland Bancorps dividend performance and assess its sustainability.
What Does Heartland Bancorp Do?
Heartland Bancorp is a bank holding company whose principal activity is the ownership and management of its wholly-owned subsidiaries, Heartland Bank (the Bank) and TransCounty Title Agency, LLC. The Bank is primarily engaged in providing a full range of banking and financial services to individual and corporate customers in central Ohio and northern Kentucky. The majority of the company's revenues come from interest and dividend income on loans, investment securities, and other financial instruments.
A Glimpse at Heartland Bancorp's Dividend History
Heartland Bancorp has maintained a consistent dividend payment record since 2003. Dividends are currently distributed on a quarterly basis. Heartland Bancorp has increased its dividend each year since 2011. The stock is thus listed as a dividend achiever, an honor that is given to companies that have increased their dividend each year for at least the past 12 years. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Heartland Bancorp's Dividend Yield and Growth
As of today, Heartland Bancorp currently has a 12-month trailing dividend yield of 3.34% and a 12-month forward dividend yield of 3.42%. This suggests an expectation of increased dividend payments over the next 12 months.
Over the past three years, Heartland Bancorp's annual dividend growth rate was 9.90%. Extended to a five-year horizon, this rate stayed the same. And over the past decade, Heartland Bancorp's annual dividends per share growth rate stands at 8.30%. Based on Heartland Bancorp's dividend yield and five-year growth rate, the 5-year yield on cost of Heartland Bancorp stock as of today is approximately 5.35%.
The Sustainability Question: Payout Ratio and Profitability
To assess the sustainability of the dividend, one needs to evaluate the company's payout ratio. The dividend payout ratio provides insights into the portion of earnings the company distributes as dividends. A lower ratio suggests that the company retains a significant part of its earnings, thereby ensuring the availability of funds for future growth and unexpected downturns. As of 2023-06-30, Heartland Bancorp's dividend payout ratio is 0.30.
Heartland Bancorp's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Heartland Bancorp's profitability 6 out of 10 as of 2023-06-30, suggesting fair profitability. The company has reported positive net income for each of year over the past decade, further solidifying its high profitability.
Growth Metrics: The Future Outlook
To ensure the sustainability of dividends, a company must have robust growth metrics. Heartland Bancorp's growth rank of 6 out of 10 suggests that the company has a fair growth outlook. Revenue is the lifeblood of any company, and Heartland Bancorp's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Heartland Bancorp's revenue has increased by approximately 12.60% per year on average, a rate that outperforms than approximately 76.55% of global competitors.
The company's 3-year EPS growth rate showcases its capability to grow its earnings, a critical component for sustaining dividends in the long run. During the past three years, Heartland Bancorp's earnings increased by approximately 11.30% per year on average, a rate that outperforms than approximately 58.24% of global competitors. Lastly, the company's 5-year EBITDA growth rate of 10.80%, which outperforms than approximately 57.58% of global competitors.
Conclusion
In conclusion, Heartland Bancorp's consistent dividend payments, impressive growth rate, and robust payout ratio underscore its commitment to rewarding shareholders. Coupled with its solid profitability and promising growth metrics, the company appears well-positioned to sustain its dividend payments in the foreseeable future. However, as with any investment, it is essential for investors to conduct their due diligence and consider their individual risk tolerance before making an investment decision.
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