Advertisement
Singapore markets closed
  • Straits Times Index

    3,224.01
    -27.70 (-0.85%)
     
  • Nikkei

    40,168.07
    -594.66 (-1.46%)
     
  • Hang Seng

    16,541.42
    +148.58 (+0.91%)
     
  • FTSE 100

    7,952.62
    +20.64 (+0.26%)
     
  • Bitcoin USD

    70,733.00
    +1,793.21 (+2.60%)
     
  • CMC Crypto 200

    885.54
    0.00 (0.00%)
     
  • S&P 500

    5,254.35
    +5.86 (+0.11%)
     
  • Dow

    39,807.37
    +47.29 (+0.12%)
     
  • Nasdaq

    16,379.46
    -20.06 (-0.12%)
     
  • Gold

    2,254.80
    +42.10 (+1.90%)
     
  • Crude Oil

    83.11
    +1.76 (+2.16%)
     
  • 10-Yr Bond

    4.2060
    +0.0100 (+0.24%)
     
  • FTSE Bursa Malaysia

    1,530.60
    -7.82 (-0.51%)
     
  • Jakarta Composite Index

    7,288.81
    -21.28 (-0.29%)
     
  • PSE Index

    6,903.53
    +5.36 (+0.08%)
     

Are You Looking for a High-Growth Dividend Stock?

All investors love getting big returns from their portfolio, whether it's through stocks, bonds, ETFs, or other types of securities. But for income investors, generating consistent cash flow from each of your liquid investments is your primary focus.

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 make up large portions of long-term returns, and in many cases, dividend contributions surpass one-third of total returns.

The First Bancshares in Focus

The First Bancshares (FBMS) is headquartered in Hattiesburg, and is in the Finance sector. The stock has seen a price change of -22.79% since the start of the year. Currently paying a dividend of $0.19 per share, the company has a dividend yield of 2.55%. In comparison, the Banks - Southeast industry's yield is 2.16%, while the S&P 500's yield is 1.85%.

ADVERTISEMENT

In terms of dividend growth, the company's current annualized dividend of $0.76 is up 31% from last year. The First Bancshares has increased its dividend 5 times on a year-over-year basis over the last 5 years for an average annual increase of 40.45%. Future dividend growth will depend on earnings growth as well as payout ratio, which is the proportion of a company's annual earnings per share that it pays out as a dividend. The First Bancshares's current payout ratio is 24%, meaning it paid out 24% of its trailing 12-month EPS as dividend.

Earnings growth looks solid for FBMS for this fiscal year. The Zacks Consensus Estimate for 2022 is $3.09 per share, with earnings expected to increase 1.64% from the year ago period.

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. It's important to keep in mind that not all companies provide a quarterly payout.

For instance, it's a rare occurrence when a tech start-up or big growth business offers their shareholders a dividend. It's more common to see larger companies with more established profits give out dividends. During periods of rising interest rates, income investors must be mindful that high-yielding stocks tend to struggle. With that in mind, FBMS is a compelling investment opportunity. Not only is it a strong dividend play, but the stock currently sits at a Zacks Rank of 3 (Hold).


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
The First Bancshares, Inc. (FBMS) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.
 
Zacks Investment Research