A Comprehensive Analysis of FFIN's Dividend History, Yield, Growth, and Sustainability
First Financial Bankshares Inc(FFIN, Financial) recently announced a dividend of $0.18 per share, payable on 2023-10-02, with the ex-dividend date set for 2023-09-13. 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 First Financial Bankshares Incs dividend performance and assess its sustainability.
Overview of First Financial Bankshares Inc
First Financial Bankshares Inc is a financial and bank holding company. The company operates one line of business (community banking) located in a single geographic area (Texas). The company conducts a full-service commercial banking business through its subsidiaries. The loan portfolio segments of the company include Commercial and Industrial, Municipal, Agricultural, Construction and Development, Farm, Non-Owner Occupied and Owner Occupied Commercial Real Estate, Residential, Consumer Auto and Consumer Non-Auto.
First Financial Bankshares Inc's Dividend History
First Financial Bankshares Inc has maintained a consistent dividend payment record since 1992. Dividends are currently distributed on a quarterly basis. First Financial Bankshares Inc has increased its dividend each year since 1994. The stock is thus listed as a dividend aristocrat, an honor that is given to companies that have increased their dividend each year for at least the past 29 years.
Below is a chart showing annual Dividends Per Share for tracking historical trends.
First Financial Bankshares Inc's Dividend Yield and Growth
As of today, First Financial Bankshares Inc currently has a 12-month trailing dividend yield of 2.55% and a 12-month forward dividend yield of 2.66%. This suggests an expectation of increase dividend payments over the next 12 months.
Over the past three years, First Financial Bankshares Inc's annual dividend growth rate was 12.40%. Extended to a five-year horizon, this rate decreased to 12.00% per year. And over the past decade, First Financial Bankshares Inc's annual dividends per share growth rate stands at an impressive 10.50%.
Based on First Financial Bankshares Inc's dividend yield and five-year growth rate, the 5-year yield on cost of First Financial Bankshares Inc stock as of today is approximately 4.49%.
Assessing Dividend Sustainability: 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, First Financial Bankshares Inc's dividend payout ratio is 0.45.
First Financial Bankshares Inc's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks First Financial Bankshares Inc's profitability 7 out of 10 as of 2023-06-30, suggesting good profitability prospects. The company has reported positive net income for each of year over the past decade, further solidifying its high profitability.
Future Growth Prospects of First Financial Bankshares Inc
To ensure the sustainability of dividends, a company must have robust growth metrics. First Financial Bankshares Inc's growth rank of 7 out of 10 suggests that the company's growth trajectory is good relative to its competitors.
Revenue is the lifeblood of any company, and First Financial Bankshares Inc's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. First Financial Bankshares Inc's revenue has increased by approximately 8.60% per year on average, a rate that outperforms than approximately 61.69% 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, First Financial Bankshares Inc's earnings increased by approximately 10.70% per year on average, a rate that outperforms than approximately 56.53% of global competitors.
Lastly, the company's 5-year EBITDA growth rate of 12.70%, which outperforms than approximately 64.27% of global competitors.
Conclusion
First Financial Bankshares Inc has demonstrated a strong dividend performance, with a consistent dividend payment record and impressive growth rates. Its low payout ratio and high profitability rank indicate a sustainable dividend. Coupled with robust growth metrics, First Financial Bankshares Inc appears well-positioned to continue its dividend payments in the future. As always, investors should conduct their own thorough research before making investment decisions.
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