CVB Financial (NASDAQ:CVBF) Will Pay A Dividend Of $0.20

CVB Financial Corp. (NASDAQ:CVBF) will pay a dividend of $0.20 on the 16th of October. This makes the dividend yield 4.0%, which will augment investor returns quite nicely.

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CVB Financial's Earnings Will Easily Cover The Distributions

A big dividend yield for a few years doesn't mean much if it can't be sustained.

CVB Financial has established itself as a dividend paying company with over 10 years history of distributing earnings to shareholders. Taking data from its last earnings report, calculating for the company's payout ratio shows 55%, which means that CVB Financial would be able to pay its last dividend without pressure on the balance sheet.

Looking forward, earnings per share is forecast to rise by 3.9% over the next year. Assuming the dividend continues along recent trends, we think the future payout ratio could be 56% by next year, which is in a pretty sustainable range.

Check out our latest analysis for CVB Financial

CVB Financial Has A Solid Track Record

Even over a long history of paying dividends, the company's distributions have been remarkably stable. Since 2015, the annual payment back then was $0.40, compared to the most recent full-year payment of $0.80. This implies that the company grew its distributions at a yearly rate of about 7.2% over that duration. The growth of the dividend has been pretty reliable, so we think this can offer investors some nice additional income in their portfolio.

The Dividend's Growth Prospects Are Limited

Some investors will be chomping at the bit to buy some of the company's stock based on its dividend history. Earnings per share has been crawling upwards at 2.4% per year. Growth of 2.4% may indicate that the company has limited investment opportunity so it is returning its earnings to shareholders instead. This isn't necessarily bad, but we wouldn't expect rapid dividend growth in the future.

We Really Like CVB Financial's Dividend

Overall, we like to see the dividend staying consistent, and we think CVB Financial might even raise payments in the future. Earnings are easily covering distributions, and the company is generating plenty of cash. Taking this all into consideration, this looks like it could be a good dividend opportunity.

It's important to note that companies having a consistent dividend policy will generate greater investor confidence than those having an erratic one. Meanwhile, despite the importance of dividend payments, they are not the only factors our readers should know when assessing a company. Companies that are growing earnings tend to be the best dividend stocks over the long term. See what the 6 analysts we track are forecasting for CVB Financial for free with public analyst estimates for the company. If you are a dividend investor, you might also want to look at our curated list of high yield dividend stocks.