M&T Bank Corp's Dividend Analysis
Delving Into M&T Bank Corp's Dividend Prospects and Stability
M&T Bank Corp (NYSE:MTB) recently announced a dividend of $1.3 per share, payable on 2024-03-29, with the ex-dividend date set for 2024-03-01. As investors look forward to this upcoming payment, the spotlight also shines on the company's dividend history, yield, and growth rates. Using the data from GuruFocus, let's look into M&T Bank Corps dividend performance and assess its sustainability.
What Does M&T Bank Corp Do?
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M&T Bank is one of the largest regional banks in the United States, with branches in New York, Pennsylvania, West Virginia, Virginia, Maryland, Delaware, and New Jersey. The bank was founded to serve manufacturing and trading businesses around the Erie Canal and is primarily focused on commercial real estate and commercial-related lending, with some retail operations also present.
A Glimpse at M&T Bank Corp's Dividend History
M&T Bank Corp has maintained a consistent dividend payment record since 1985. Dividends are currently distributed on a quarterly basis.
M&T Bank Corp has increased its dividend each year since 1985. The stock is thus listed as a dividend aristocrat, an honor that is given to companies that have increased their dividend each year for at least the past 39 years. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down M&T Bank Corp's Dividend Yield and Growth
As of today, M&T Bank Corp currently has a 12-month trailing dividend yield of 3.72% and a 12-month forward dividend yield of 3.72%. This suggests an expectation of same dividend payments over the next 12 months.
Over the past three years, M&T Bank Corp's annual dividend growth rate was 5.70%. Extended to a five-year horizon, this rate increased to 7.10% per year. And over the past decade, M&T Bank Corp's annual dividends per share growth rate stands at 7.40%.
Based on M&T Bank Corp's dividend yield and five-year growth rate, the 5-year yield on cost of M&T Bank Corp stock as of today is approximately 5.24%.
The Sustainability Question: Payout Ratio and Profitability
To assess the sustainability of the dividend, one needs to evaluate the company's payout ratio. The dividend payout ratio provides insights into the portion of earnings the company distributes as dividends. A lower ratio suggests that the company retains a significant part of its earnings, thereby ensuring the availability of funds for future growth and unexpected downturns. As of 2023-12-31, M&T Bank Corp's dividend payout ratio is 0.33.