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Orrstown Financial Services (ORRF) is a Top Dividend Stock Right Now: Should You Buy?
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Getting big returns from financial portfolios, whether through stocks, bonds, ETFs, other securities, or a combination of all, is an investor's dream. But when you're an income investor, your primary focus is generating consistent cash flow from each of your liquid investments.
While cash flow can come from bond interest or interest from other types of investments, income investors hone in on dividends. A dividend is that coveted distribution of a company's earnings paid out to shareholders, and investors often view it by its dividend yield, a metric that measures the dividend as a percent of the current stock price. Many academic studies show that dividends account for significant portions of long-term returns, with dividend contributions exceeding one-third of total returns in many cases.
Orrstown Financial Services in Focus
Headquartered in Harrisburg, Orrstown Financial Services (ORRF - Free Report) is a Finance stock that has seen a price change of 21.36% so far this year. The holding company for Orrstown Bank is paying out a dividend of $0.23 per share at the moment, with a dividend yield of 2.57% compared to the Banks - Northeast industry's yield of 2.8% and the S&P 500's yield of 1.55%.
Looking at dividend growth, the company's current annualized dividend of $0.92 is up 15% from last year. In the past five-year period, Orrstown Financial Services has increased its dividend 4 times on a year-over-year basis for an average annual increase of 5.82%. Looking ahead, future dividend growth will be dependent on earnings growth and payout ratio, which is the proportion of a company's annual earnings per share that it pays out as a dividend. Orrstown's current payout ratio is 23%. This means it paid out 23% of its trailing 12-month EPS as dividend.
Earnings growth looks solid for ORRF for this fiscal year. The Zacks Consensus Estimate for 2024 is $3.61 per share, with earnings expected to increase 2.85% from the year ago period.
Bottom Line
Investors like dividends for a variety of different reasons, from tax advantages and decreasing overall portfolio risk to considerably improving stock investing profits. But, not every company offers a quarterly payout.
For instance, it's a rare occurrence when a tech start-up or big growth business offers their shareholders a dividend. It's more common to see larger companies with more established profits give out dividends. During periods of rising interest rates, income investors must be mindful that high-yielding stocks tend to struggle. With that in mind, ORRF is a compelling investment opportunity. Not only is it a strong dividend play, but the stock currently sits at a Zacks Rank of 3 (Hold).
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Orrstown Financial Services (ORRF) is a Top Dividend Stock Right Now: Should You Buy?
Getting big returns from financial portfolios, whether through stocks, bonds, ETFs, other securities, or a combination of all, is an investor's dream. But when you're an income investor, your primary focus is generating consistent cash flow from each of your liquid investments.
While cash flow can come from bond interest or interest from other types of investments, income investors hone in on dividends. A dividend is that coveted distribution of a company's earnings paid out to shareholders, and investors often view it by its dividend yield, a metric that measures the dividend as a percent of the current stock price. Many academic studies show that dividends account for significant portions of long-term returns, with dividend contributions exceeding one-third of total returns in many cases.
Orrstown Financial Services in Focus
Headquartered in Harrisburg, Orrstown Financial Services (ORRF - Free Report) is a Finance stock that has seen a price change of 21.36% so far this year. The holding company for Orrstown Bank is paying out a dividend of $0.23 per share at the moment, with a dividend yield of 2.57% compared to the Banks - Northeast industry's yield of 2.8% and the S&P 500's yield of 1.55%.
Looking at dividend growth, the company's current annualized dividend of $0.92 is up 15% from last year. In the past five-year period, Orrstown Financial Services has increased its dividend 4 times on a year-over-year basis for an average annual increase of 5.82%. Looking ahead, future dividend growth will be dependent on earnings growth and payout ratio, which is the proportion of a company's annual earnings per share that it pays out as a dividend. Orrstown's current payout ratio is 23%. This means it paid out 23% of its trailing 12-month EPS as dividend.
Earnings growth looks solid for ORRF for this fiscal year. The Zacks Consensus Estimate for 2024 is $3.61 per share, with earnings expected to increase 2.85% from the year ago period.
Bottom Line
Investors like dividends for a variety of different reasons, from tax advantages and decreasing overall portfolio risk to considerably improving stock investing profits. But, not every company offers a quarterly payout.
For instance, it's a rare occurrence when a tech start-up or big growth business offers their shareholders a dividend. It's more common to see larger companies with more established profits give out dividends. During periods of rising interest rates, income investors must be mindful that high-yielding stocks tend to struggle. With that in mind, ORRF is a compelling investment opportunity. Not only is it a strong dividend play, but the stock currently sits at a Zacks Rank of 3 (Hold).