Here’s What We Like About Fulton Financial’s (NASDAQ:FULT) Upcoming Dividend

Fulton Financial Corporation (NASDAQ:FULT) is about to trade ex-dividend in the next 4 days. The ex-dividend date is usually set to be one business day before the record date, which is the cut-off date on which you must be present on the company’s books as a shareholder in order to receive the dividend. The ex-dividend date is important as the process of settlement involves a full business day. So if you miss that date, you would not show up on the company’s books on the record date. This means that investors who purchase Fulton Financial’s shares on or after the 31st of December will not receive the dividend, which will be paid on the 15th of January.

The company’s next dividend payment will be US$0.19 per share, and in the last 12 months, the company paid a total of US$0.72 per share. Based on the last year’s worth of payments, Fulton Financial has a trailing yield of 3.8% on the current stock price of US$20.19. Dividends are a major contributor to investment returns for long term holders, but only if the dividend continues to be paid. We need to see whether the dividend is covered by earnings and if it’s growing.

We’ve found 21 US stocks that are forecast to pay a dividend yield of over 6% next year. See the full list for free.

Dividends are usually paid out of company profits, so if a company pays out more than it earned then its dividend is usually at greater risk of being cut. That’s why it’s good to see Fulton Financial paying out a modest 37% of its earnings.

When a company paid out less in dividends than it earned in profit, this generally suggests its dividend is affordable. The lower the % of its profit that it pays out, the greater the margin of safety for the dividend if the business enters a downturn.

See our latest analysis for Fulton Financial

Click here to see the company’s payout ratio, plus analyst estimates of its future dividends.

Stocks in companies that generate sustainable earnings growth often make the best dividend prospects, as it is easier to lift the dividend when earnings are rising. If earnings fall far enough, the company could be forced to cut its dividend. This is why it’s a relief to see Fulton Financial earnings per share are up 7.5% per annum over the last five years.

Another key way to measure a company’s dividend prospects is by measuring its historical rate of dividend growth. In the last 10 years, Fulton Financial has lifted its dividend by approximately 7.8% 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.

Should investors buy Fulton Financial for the upcoming dividend? Fulton Financial has seen its earnings per share grow slowly in recent years, and the company reinvests more than half of its profits in the business, which generally bodes well for its future prospects. In summary, Fulton Financial appears to have some promise as a dividend stock, and we’d suggest taking a closer look at it.

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

Generally, we wouldn’t recommend just buying the first dividend stock you see. Here’s a curated list of interesting stocks that are strong dividend payers.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.