© Reuters.
Cullen/Frost Bankers (NYSE:) has announced an increase in its dividend to $0.92, aligning with the industry’s average dividend yield of 4.1%. The new dividend is set for distribution on December 15th. The bank’s current payout ratio stands at 34%, indicating strong dividend coverage by earnings and showcasing the institution’s financial health.
Despite a projected 16.5% decline in earnings per share (EPS) over the next three years, experts forecast a future payout ratio of 44%, considered sustainable given the bank’s financial status. This projection is based on the bank’s robust track record of dividends, which has shown an annual growth rate of 6.7%. Payouts have risen from $1.92 in 2013 to $3.68 in the most recent fiscal year.
The company’s EPS has also demonstrated a healthy growth rate of 9.5% per year over the past five years, suggesting substantial potential for future dividend growth despite the anticipated short-term EPS drop. The consistent dividends history and promising growth rate underscore Cullen/Frost Bankers’ commitment to rewarding its shareholders while maintaining a stable financial footing.
InvestingPro Insights
InvestingPro’s real-time data further illuminates the financial health of Cullen/Frost Bankers. The bank boasts a market capitalization of $5740M and a P/E ratio of 8.56 as of Q3 2023, indicating a lower price relative to near-term earnings growth. The revenue growth for the same period stands at an impressive 26.89%, reflecting the bank’s robust financial performance.
Two key InvestingPro Tips align with the article’s focus on dividends. Firstly, Cullen/Frost Bankers has a strong track record of raising its dividend, having done so for 31 consecutive years. Secondly, the bank yields a high return on invested capital, which is likely a contributing factor to its ability to consistently increase dividends.
For more detailed insights, including additional InvestingPro Tips and real-time data, consider subscribing to InvestingPro’s premium service. With a total of 9 tips listed for Cullen/Frost Bankers alone, the service offers a wealth of information to help guide your investment decisions. Visit InvestingPro Pricing for more information.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.
Read the full article here