Yahoo Finance First Northwest Bancorp (NASDAQ:FNWB) Has Announced A Dividend Of $0.07
First Northwest Bancorp's (NASDAQ:FNWB) investors are due to receive a payment of $0.07 per share on 24th of November. This means the annual payment will be 2.1% of the current stock price, which is lower than the industry average.
See our latest analysis for First Northwest Bancorp
First Northwest Bancorp's Dividend Forecasted To Be Well Covered By Earnings
The dividend yield is a little bit low, but sustainability of the payments is also an important part of evaluating an income stock.
Having paid out dividends for 5 years, First Northwest Bancorp has a good history of paying out a part of its earnings to shareholders. While past data isn't a guarantee for the future, First Northwest Bancorp's latest earnings report puts its payout ratio at 18%, showing that the company can pay out its dividends comfortably.
Over the next year, EPS is forecast to fall by 11.7%. But if the dividend continues along the path it has been on recently, we estimate the future payout ratio could be 26%, which would be comfortable for the company to continue in the future.
First Northwest Bancorp Doesn't Have A Long Payment History
The dividend's track record has been pretty solid, but with only 5 years of history we want to see a few more years of history before making any solid conclusions. Since 2018, the annual payment back then was $0.12, compared to the most recent full-year payment of $0.28. This implies that the company grew its distributions at a yearly rate of about 18% over that duration. It is always nice to see strong dividend growth, but with such a short payment history we wouldn't be inclined to rely on it until a longer track record can be developed.
The Dividend Looks Likely To Grow
The company's investors will be pleased to have been receiving dividend income for some time. We are encouraged to see that First Northwest Bancorp has grown earnings per share at 27% per year over the past five years. Earnings per share is growing at a solid clip, and the payout ratio is low which we think is an ideal combination in a dividend stock as the company can quite easily raise the dividend in the future.
First Northwest Bancorp Looks Like A Great Dividend Stock
Overall, we like to see the dividend staying consistent, and we think First Northwest Bancorp might even raise payments in the future. The distributions are easily covered by earnings, and there is plenty of cash being generated as well. However, it is worth noting that the earnings are expected to fall over the next year, which may not change the long term outlook, but could affect the dividend payment in the next 12 months. All of these factors considered, we think this has solid potential as a dividend stock.
Companies possessing a stable dividend policy will likely enjoy greater investor interest than those suffering from a more inconsistent approach. Meanwhile, despite the importance of dividend payments, they are not the only factors our readers should know when assessing a company. To that end, First Northwest Bancorp has 2 warning signs (and 1 which shouldn't be ignored) we think you should know about. If you are a dividend investor, you might also want to look at our curated list of high yield dividend stocks.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
