Yahoo Finance Income Investors Should Know That Citizens & Northern Corporation (NASDAQ:CZNC) Goes Ex-Dividend Soon
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Citizens & Northern Corporation (NASDAQ:CZNC) stock is about to trade ex-dividend in 3 days. This means that investors who purchase shares on or after the 24th of July will not receive the dividend, which will be paid on the 7th of August.
Citizens & Northern's next dividend payment will be US$0.27 per share, and in the last 12 months, the company paid a total of US$1.08 per share. Based on the last year's worth of payments, Citizens & Northern stock has a trailing yield of around 5.8% on the current share price of $18.53. Dividends are a major contributor to investment returns for long term holders, but only if the dividend continues to be paid. So we need to check whether the dividend payments are covered, and if earnings are growing.
Check out our latest analysis for Citizens & Northern
Dividends are usually paid out of company profits, so if a company pays out more than it earned then its dividend is usually at greater risk of being cut. Citizens & Northern is paying out an acceptable 73% of its profit, a common payout level among most companies.
Generally speaking, the lower a company's payout ratios, the more resilient its dividend usually is.
Click here to see how much of its profit Citizens & Northern paid out over the last 12 months.
Have Earnings And Dividends Been Growing?
Stocks with flat earnings can still be attractive dividend payers, but it is important to be more conservative with your approach and demand a greater margin for safety when it comes to dividend sustainability. Investors love dividends, so if earnings fall and the dividend is reduced, expect a stock to be sold off heavily at the same time. That explains why we're not overly excited about Citizens & Northern's flat earnings over the past five years. It's better than seeing them drop, certainly, but over the long term, all of the best dividend stocks are able to meaningfully grow their earnings per share.
Another key way to measure a company's dividend prospects is by measuring its historical rate of dividend growth. Citizens & Northern has delivered an average of 1.2% per year annual increase in its dividend, based on the past ten years of dividend payments.
The Bottom Line
Is Citizens & Northern an attractive dividend stock, or better left on the shelf? Citizens & Northern has been struggling to generate growth while also paying out more than half of its earnings to shareholders as dividends. In sum this is a middling combination, and we find it hard to get excited about the company from a dividend perspective.
With that being said, if dividends aren't your biggest concern with Citizens & Northern, you should know about the other risks facing this business. In terms of investment risks, we've identified 2 warning signs with Citizens & Northern and understanding them should be part of your investment process.
A common investment mistake is buying the first interesting stock you see. Here you can find a list of promising dividend stocks with a greater than 2% yield and an upcoming dividend.
This article by Simply Wall St is general in nature. 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.
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