Landmark Bancorp (NASDAQ:LARK) Has Announced A Dividend Of $0.21

The board of Landmark Bancorp, Inc. (NASDAQ:LARK) has announced that it will pay a dividend of $0.21 per share on the 26th of November. This payment means that the dividend yield will be 3.3%, which is around the industry average.

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Landmark Bancorp's Earnings Will Easily Cover The Distributions

While it is always good to see a solid dividend yield, we should also consider whether the payment is feasible.

Landmark Bancorp has a long history of paying out dividends, with its current track record at a minimum of 10 years. Past distributions do not necessarily guarantee future ones, but Landmark Bancorp's payout ratio of 28% is a good sign as this means that earnings decently cover dividends.

If the trend of the last few years continues, EPS will grow by 0.2% over the next 12 months. Assuming the dividend continues along recent trends, we think the future payout ratio could be 30% by next year, which is in a pretty sustainable range.

See our latest analysis for Landmark Bancorp

Landmark Bancorp Has A Solid Track Record

The company has a sustained record of paying dividends with very little fluctuation. The annual payment during the last 10 years was $0.467 in 2015, and the most recent fiscal year payment was $0.84. This means that it has been growing its distributions at 6.1% per annum over that time. Companies like this can be very valuable over the long term, if the decent rate of growth can be maintained.

Dividend Growth May Be Hard To Achieve

Investors could be attracted to the stock based on the quality of its payment history. Although it's important to note that Landmark Bancorp's earnings per share has basically not grown from where it was five years ago, which could erode the purchasing power of the dividend over time. If Landmark Bancorp is struggling to find viable investments, it always has the option to increase its payout ratio to pay more to shareholders.

Landmark Bancorp Looks Like A Great Dividend Stock

Overall, we think that this is a great income investment, and we think that maintaining the dividend this year may have been a conservative choice. Distributions are quite easily covered by earnings, which are also being converted to cash flows. Taking this all into consideration, this looks like it could be a good dividend opportunity.

Companies possessing a stable dividend policy will likely enjoy greater investor interest than those suffering from a more inconsistent approach. Still, investors need to consider a host of other factors, apart from dividend payments, when analysing a company. As an example, we've identified 1 warning sign for Landmark Bancorp that you should be aware of before investing. If you are a dividend investor, you might also want to look at our curated list of high yield dividend stocks.

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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.