10 More Bank Stocks With Solid Dividends
thestreet.com
Among those banks mentioned is GIW:
The cheapest stock on the list relative to book value was Wilber Corporation (GIW) of Oneonta, N.Y., which was also the lowest-yielding, at 4.03%. Shares closed at $5.95 Thursday, down 16% year-to-date and trading for 0.9 times tangible book value. The quarterly dividend payout was lowered from 38 cents to 24 cents a share in April.
That dividend cut brought the company's payout ratio to just 32% according to SNL, which was the lowest payout ratio for any of the listed bank stocks and indicates that Wilber's dividend is now very comfortably supported by earnings.
This has obviously been a rough year for Wilber's shareholders, however, for investors considering the shares, this could be a good entry point. The company's earnings performance through the crisis hasn't been stellar, but it has remained profitable and loan losses have been relatively light. Shares were trading at 12 times projected 2010 earnings, and moving out to the 2012 consensus projection, the price-to-earnings ratio drops to 10.3.
One of the main reasons for the company's mediocre earnings over the past two years was its need to beef up loan loss reserves. Over coming quarters, economic improvement may well allow the company to go in the other direction and release reserves, boosting quarterly earnings performance and quite possibly causing analysts to increase their earnings projections.
A profitable franchise trading below liquidation value represents good value for potential investors and even makes Wilber a good takeout target for another bank.
Anyone have an opinion or looked at GIW? |
