Are you looking for a high growth dividend stock? Riverview Bancorp (RVSB) could be a great choice – October 7, 2021
Getting big returns from financial portfolios, whether through stocks, bonds, ETFs, other securities, or a combination of all of them, is an investor’s dream. However, when you are an income investor, your main goal is to generate consistent cash flow from each of your liquid investments.
While cash flow can come from bond interest or interest from other types of investments, income investors focus on dividends. A dividend is the distribution of a company’s profits paid to shareholders; it is often viewed by its dividend yield, a measure that measures a dividend as a percentage of the current stock price. Numerous academic studies show that dividends are a large part of long-term returns, and in many cases dividend contributions exceed one-third of total returns.
Riverview Bancorp in brief
Riverview Bancorp (RVSB – Free Report) is headquartered in Vancouver and is part of the finance industry. The stock has seen a 36.69% price change since the start of the year. Currently paying a dividend of $ 0.05 per share, the company has a dividend yield of 3.06%. In comparison, the return of the Financial Industry – Savings and Credit is 2.42%, while the return of the S&P 500 is 1.4%.
Looking at the company’s dividend growth, its current annualized dividend of $ 0.22 is up 10% from a year ago. Over the past 5 years, Riverview Bancorp has increased its dividend 4 times year over year for an average annual increase of 25.71%. Any future dividend growth will depend on both earnings growth and the payout ratio of the company; a payout ratio is the proportion of a company’s annual earnings per share that it pays out as a dividend. Riverview Bancorp’s current payout ratio is 29%, which means that it paid out 29% of its past 12-month EPS as a dividend.
Profit growth looks strong for RVSB for this fiscal year. Zacks’ consensus estimate for 2021 is $ 0.88 per share, which represents a year-over-year profit growth rate of 87.23%.
Whether it’s dramatically improving earnings from equity investments and reducing overall portfolio risk or offering tax benefits, investors love dividends for a variety of reasons. However, not all companies offer quarterly payment.
For example, it is rare for a tech start-up or a growing company to offer a dividend to its shareholders. It’s more common to see larger companies with more established earnings pay dividends. Income investors should be aware that high yielding stocks tend to struggle during times of rising interest rates. With this in mind, RVSB is a compelling investment opportunity. Not only is this a big dividend game, the stock currently sits at Zacks rank of 3 (Hold).