Interested In Truist Financial's (NYSE:TFC) Upcoming US$0.45 Dividend? You Have Two Days Left
Truist Financial Corporation (NYSE:TFC) stock is about to trade ex-dividend in 2 days. You can purchase shares before the 12th of November in order to receive the dividend, which the company will pay on the 1st of December.
Truist Financial’s upcoming dividend is US$0.45 a share, following on from the last 12 months, when the company distributed a total of US$1.80 per share to shareholders. Looking at the last 12 months of distributions, Truist Financial has a trailing yield of approximately 4.2% on its current stock price of $42.99. If you buy this business for its dividend, you should have an idea of whether Truist Financial’s dividend is reliable and sustainable. As a result, readers should always check whether Truist Financial has been able to grow its dividends, or if the dividend might be cut.
See our latest analysis for Truist Financial
If a company pays out more in dividends than it earned, then the dividend might become unsustainable – hardly an ideal situation. Truist Financial is paying out an acceptable 61% 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 the company’s payout ratio, plus analyst estimates of its future dividends.
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. If earnings decline and the company is forced to cut its dividend, investors could watch the value of their investment go up in smoke. With that in mind, we’re not enthused to see that Truist Financial’s earnings per share have remained effectively flat over the past five years. Better than seeing them fall off a cliff, for sure, but the best dividend stocks grow their earnings meaningfully over the long run.
The main way most investors will assess a company’s dividend prospects is by checking the historical rate of dividend growth. In the past 10 years, Truist Financial has increased its dividend at approximately 12% a year on average.
Final Takeaway
From a dividend perspective, should investors buy or avoid Truist Financial? Truist Financial has been struggling to generate growth while also paying out more than half of its earnings to shareholders as dividends. At best we would put it on a watch-list to see if business conditions improve, as it doesn’t look like a clear opportunity right now.
So if you want to do more digging on Truist Financial, you’ll find it worthwhile knowing the risks that this stock faces. Our analysis shows 2 warning signs for Truist Financial that we strongly recommend you have a look at before investing in the company.
We wouldn’t recommend just buying the first dividend stock you see, though. Here’s a list of interesting 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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