On the 19 January 2018, Horizon Bancorp (NASDAQ:HBNC) will be paying shareholders an upcoming dividend amount of $0.13 per share. However, investors must have bought the company’s stock before 04 January 2018 in order to qualify for the payment. That means you have only 3 days left! Should you diversify into Horizon Bancorp and boost your portfolio income stream? Well, keep on reading because today, I’m going to look at the latest data and analyze the stock and its dividend property in further detail. Check out our latest analysis for Horizon Bancorp
5 questions to ask before buying a dividend stock
Whenever I am looking at a potential dividend stock investment, I always check these five metrics:
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Is it paying an annual yield above 75% of dividend payers?
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Has it paid dividend every year without dramatically reducing payout in the past?
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Has dividend per share amount increased over the past?
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Does earnings amply cover its dividend payments?
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Will it have the ability to keep paying its dividends going forward?
Does Horizon Bancorp pass our checks?
The company currently pays out 34.44% of its earnings as a dividend, which means that the dividend is covered by earnings. However, going forward, analysts expect HBNC’s payout to fall to 26.93% of its earnings, which leads to a dividend yield of around 2.08%. However, EPS should increase to $1.91, 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 HBNC it has increased its DPS from $0.18 to $0.52 in the past 10 years. It has also been paying out dividend consistently during this time, as you’d expect for a company increasing its dividend levels. These are all positive signs of a great, reliable dividend stock. In terms of its peers, Horizon Bancorp produces a yield of 1.87%, which is on the low-side for banks stocks.
What this means for you:
Are you a shareholder? With Horizon Bancorp producing strong dividend income for your portfolio over the past few years, you can take comfort in knowing that this stock will still continue to be a robust dividend generator moving forward. But, depending on your current holdings, it may be beneficial exploring other dividend stocks to improve your diversification, or even look at high-growth stocks to supplement your steady income stocks. I recommend continuing your research by exploring my interactive free list of dividend rockstars as well as high-growth stocks to potentially add to your holdings.