Yahoo Finance Pacific Premier Bancorp's (NASDAQ:PPBI) Dividend Will Be $0.33
Pacific Premier Bancorp, Inc. (NASDAQ:PPBI) will pay a dividend of $0.33 on the 13th of May. The dividend yield will be 6.0% based on this payment which is still above the industry average.
See our latest analysis for Pacific Premier Bancorp
Pacific Premier Bancorp Not Expected To Earn Enough To Cover Its Payments
A big dividend yield for a few years doesn't mean much if it can't be sustained.
Pacific Premier Bancorp has a good history of paying out dividends, with its current track record at 5 years. But while this history shows that Pacific Premier Bancorp was able to sustain its dividend for a decent period of time, its most recent earnings report shows that the company's net income wasn't enough to cover dividends. This is an alarming sign for the sustainability of its dividends, as it may mean that Pacific Premier Bancorpis pulling cash from elsewhere to keep its shareholders happy.
Earnings per share is forecast to rise by 75.6% over the next year. However, if the dividend continues along recent trends, it could start putting pressure on the balance sheet with the payout ratio getting very high over the next year.
Pacific Premier Bancorp Doesn't Have A Long Payment History
Even though the company has been paying a consistent dividend for a while, we would like to see a few more years before we feel comfortable relying on it. Since 2019, the dividend has gone from $0.88 total annually to $1.32. This implies that the company grew its distributions at a yearly rate of about 8.4% over that duration. The dividend has been growing as a reasonable rate, which we like. However, investors will probably want to see a longer track record before they consider Pacific Premier Bancorp to be a consistent dividend paying stock.
The Dividend Has Limited Growth Potential
Investors who have held shares in the company for the past few years will be happy with the dividend income they have received. However, things aren't all that rosy. Pacific Premier Bancorp's EPS has fallen by approximately 43% per year during the past five years. Dividend payments are likely to come under some pressure unless EPS can pull out of the nosedive it is in. Over the next year, however, earnings are actually predicted to rise, but we would still be cautious until a track record of earnings growth can be built.
We're Not Big Fans Of Pacific Premier Bancorp's Dividend
In summary, while it is good to see that the dividend hasn't been cut, we think that at current levels the payment isn't particularly sustainable. The company seems to be stretching itself a bit to make such big payments, but it doesn't appear they can be consistent over time. Overall, this doesn't get us very excited from an income standpoint.
Companies possessing a stable dividend policy will likely enjoy greater investor interest than those suffering from a more inconsistent approach. However, there are other things to consider for investors when analysing stock performance. For example, we've picked out 2 warning signs for Pacific Premier Bancorp that investors should know about before committing capital to this stock. Looking for more high-yielding dividend ideas? Try our collection of strong dividend payers.
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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.
