Here's What We Like About Sandy Spring Bancorp, Inc. (NASDAQ:SASR)'s Upcoming Dividend

It looks like Sandy Spring Bancorp, Inc. (NASDAQ:SASR) is about to go ex-dividend in the next 3 days. Investors can purchase shares before the 11th of February in order to be eligible for this dividend, which will be paid on the 19th of February.

Sandy Spring Bancorp's next dividend payment will be US$0.30 per share, on the back of last year when the company paid a total of US$1.20 to shareholders. Based on the last year's worth of payments, Sandy Spring Bancorp has a trailing yield of 3.3% on the current stock price of $35.87. If you buy this business for its dividend, you should have an idea of whether Sandy Spring Bancorp's dividend is reliable and sustainable. As a result, readers should always check whether Sandy Spring Bancorp has been able to grow its dividends, or if the dividend might be cut.

View our latest analysis for Sandy Spring Bancorp

Dividends are typically paid out of company income, so if a company pays out more than it earned, its dividend is usually at a higher risk of being cut. Fortunately Sandy Spring Bancorp's payout ratio is modest, at just 36% of profit.

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?

Companies with consistently growing earnings per share generally make the best dividend stocks, as they usually find it easier to grow dividends per share. If business enters a downturn and the dividend is cut, the company could see its value fall precipitously. For this reason, we're glad to see Sandy Spring Bancorp's earnings per share have risen 16% per annum over the last five years.

Many investors will assess a company's dividend performance by evaluating how much the dividend payments have changed over time. Since the start of our data, ten years ago, Sandy Spring Bancorp has lifted its dividend by approximately 9.6% a year on average. We're glad to see dividends rising alongside earnings over a number of years, which may be a sign the company intends to share the growth with shareholders.

Final Takeaway

Should investors buy Sandy Spring Bancorp for the upcoming dividend? When companies are growing rapidly and retaining a majority of the profits within the business, it's usually a sign that reinvesting earnings creates more value than paying dividends to shareholders. This strategy can add significant value to shareholders over the long term - as long as it's done without issuing too many new shares. Overall, Sandy Spring Bancorp looks like a promising dividend stock in this analysis, and we think it would be worth investigating further.

Curious what other investors think of Sandy Spring Bancorp? See what analysts are forecasting, with this visualisation of its historical and future estimated earnings and cash flow.

If you're in the market for dividend stocks, we recommend checking our list of top dividend stocks with a greater than 2% yield and an upcoming dividend.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.