Shares of Home Bancshares Inc (Conway, AR) (NASDAQ:HOMB) will begin trading ex-dividend in 3 days. To qualify for the dividend check of $0.11 per share, investors must have owned the shares prior to 13 February 2018, which is the last day the company’s management will finalize their list of shareholders to which they will send dividend payments. Is this future income stream a compelling catalyst for dividend investors to think about the stock as an investment today? Let’s take a look at Home Bancshares (Conway AR)’s most recent financial data to examine its dividend characteristics in more detail. See our latest analysis for Home Bancshares (Conway AR)
Here’s how I find good dividend stocks
When assessing a stock as a potential addition to my dividend Portfolio, I look at these five areas:
Is it the top 25% annual dividend yield payer? Does it consistently pay out dividends without missing a payment of significantly cutting payout? Has it increased its dividend per share amount over the past? Does earnings amply cover its dividend payments? Will it have the ability to keep paying its dividends going forward?
NasdaqGS:HOMB Historical Dividend Yield Feb 9th 18
Home Bancshares (Conway AR) has a trailing twelve-month payout ratio of 44.66%, meaning the dividend is sufficiently covered by earnings. In the near future, analysts are predicting lower payout ratio of 26.96%, leading to a dividend yield of around 2.12%. However, EPS should increase to $1.76, meaning that the lower payout ratio does not necessarily implicate a lower dividend payment. If there’s one type of stock you want to be reliable, it’s dividend stocks and their stable income-generating ability. In the case of HOMB it has increased its DPS from $0.04 to $0.44 in the past 10 years. During this period it has not missed a payment, as one would expect for a company increasing its dividend. This is an impressive feat, which makes HOMB a true dividend rockstar. Compared to its peers, Home Bancshares (Conway AR) generates a yield of 1.90%, which is on the low-side for Banks stocks.
Considering the dividend attributes we analyzed above, Home Bancshares (Conway AR) is definitely worth keeping an eye on for someone looking to build a dedicated income portfolio. Given that this is purely a dividend analysis, I recommend taking sufficient time to understand its core business and determine whether the company and its investment properties suit your overall goals. I’ve put together three key aspects you should further examine:
1. Future Outlook: What are well-informed industry analysts predicting for HOMB’s future growth? Take a look at our free research report of analyst consensus for HOMB’s outlook.2. Valuation: What is HOMB worth today? Even if the stock is a cash cow, it’s not worth an infinite price. The intrinsic value infographic in our free research report helps visualize whether HOMB is currently mispriced by the market.3. Other Dividend Rockstars: Are there better dividend payers with stronger fundamentals out there? Check out our free list of these great stocks here.
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned.