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Bar Harbor Bankshares (BHB) Could Be a Great Choice
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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.
While cash flow can come from bond interest or interest from other types of investments, income investors hone in on dividends. A dividend is that coveted distribution of a company's earnings paid out to shareholders, and investors often view it by its dividend yield, a metric that measures the 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.
Bar Harbor Bankshares in Focus
Bar Harbor Bankshares (BHB - Free Report) is headquartered in Bar Harbor, and is in the Finance sector. The stock has seen a price change of -24.72% since the start of the year. The bank is paying out a dividend of $0.28 per share at the moment, with a dividend yield of 4.64% compared to the Banks - Northeast industry's yield of 3.39% and the S&P 500's yield of 1.79%.
In terms of dividend growth, the company's current annualized dividend of $1.12 is up 9.8% from last year. Over the last 5 years, Bar Harbor Bankshares has increased its dividend 4 times on a year-over-year basis for an average annual increase of 6.06%. Any future dividend growth will depend on both earnings growth and the company's payout ratio; a payout ratio is the proportion of a firm's annual earnings per share that it pays out as a dividend. Bar Harbor's current payout ratio is 33%. This means it paid out 33% of its trailing 12-month EPS as dividend.
BHB is expecting earnings to expand this fiscal year as well. The Zacks Consensus Estimate for 2023 is $2.99 per share, which represents a year-over-year growth rate of 3.46%.
Bottom Line
Investors like dividends for a variety of different reasons, from tax advantages and decreasing overall portfolio risk to considerably improving stock investing profits. But, not every company offers 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. Income investors have to be mindful of the fact that high-yielding stocks tend to struggle during periods of rising interest rates. That said, they can take comfort from the fact that BHB 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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Bar Harbor Bankshares (BHB) Could Be a Great Choice
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.
While cash flow can come from bond interest or interest from other types of investments, income investors hone in on dividends. A dividend is that coveted distribution of a company's earnings paid out to shareholders, and investors often view it by its dividend yield, a metric that measures the 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.
Bar Harbor Bankshares in Focus
Bar Harbor Bankshares (BHB - Free Report) is headquartered in Bar Harbor, and is in the Finance sector. The stock has seen a price change of -24.72% since the start of the year. The bank is paying out a dividend of $0.28 per share at the moment, with a dividend yield of 4.64% compared to the Banks - Northeast industry's yield of 3.39% and the S&P 500's yield of 1.79%.
In terms of dividend growth, the company's current annualized dividend of $1.12 is up 9.8% from last year. Over the last 5 years, Bar Harbor Bankshares has increased its dividend 4 times on a year-over-year basis for an average annual increase of 6.06%. Any future dividend growth will depend on both earnings growth and the company's payout ratio; a payout ratio is the proportion of a firm's annual earnings per share that it pays out as a dividend. Bar Harbor's current payout ratio is 33%. This means it paid out 33% of its trailing 12-month EPS as dividend.
BHB is expecting earnings to expand this fiscal year as well. The Zacks Consensus Estimate for 2023 is $2.99 per share, which represents a year-over-year growth rate of 3.46%.
Bottom Line
Investors like dividends for a variety of different reasons, from tax advantages and decreasing overall portfolio risk to considerably improving stock investing profits. But, not every company offers 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. Income investors have to be mindful of the fact that high-yielding stocks tend to struggle during periods of rising interest rates. That said, they can take comfort from the fact that BHB is not only an attractive dividend play, but is also a compelling investment opportunity with a Zacks Rank of #2 (Buy).