Public Bank Berhad announces attractive dividend payment

The Malaysian Public Bank Berhad has announced a dividend of 0.10 MYR per share to be paid on September 23. This corresponds to a dividend yield of 4.3%, which is in line with the industry average. While a solid dividend yield is pleasing, the sustainability of the payment should also be considered. Public Bank Berhad boasts an impressive dividend history of at least ten years. According to the latest earnings report, the payout ratio is 57%, which indicates a stable foundation but also allows for potential fluctuations. Analysts estimate that earnings per share will increase by 13.8% over the next three years. This results in an expected future payout ratio of 58%, which is seen as positive for future dividend payments. Despite these positive prospects, it should be noted that the company has cut its dividend at least once in the past ten years. Comparing the annual dividend payment of 0.104 MYR in 2014 with the most recent payment of 0.20 MYR, an annual growth rate of 6.8% is observed. While this is solid growth, the historical inconsistency remains a blemish. The moderate annual growth in earnings per share of 4.1% may somewhat offset past dividend volatility. As Public Bank Berhad struggles to find profitable investment opportunities, more capital is being returned to shareholders. However, this does not indicate rapid dividend growth in the future. In summary, Public Bank Berhad's dividend is adequate, and the increase is a positive sign. The dividend payments have historically been at a reasonable level, albeit not always consistent. Therefore, some caution is warranted when assessing the stock. Investors generally tend to favor companies with a stable dividend policy. However, other factors should also be considered in stock analysis alongside the dividend history. For example, there is a warning signal for Public Bank Berhad that investors should be aware of before committing capital. For those seeking alternative dividend stocks, there is a selection of top dividend stocks available.