BankUnited, Inc. BKU has hiked its quarterly dividend. The company announced a quarterly cash dividend of 31 cents per share, marking an increase of 6.8% from the prior payout. This dividend will be paid out on April 30, 2025, to shareholders of record as of April 11.
Prior to this, BKU hiked its dividend 7.4% to 29 cents per share on Feb. 26, 2024. The company has increased its dividend payout five times in the past five years and has five-year annualized dividend growth of 6.40%. Currently, the company’s payout ratio is 38% of earnings.
Based on the yesterday's closing price of $35.47, BankUnited currently has a dividend yield of 3.27% compared with the industry’s yield of 3.55%.
BankUnited, Inc. Dividend Yield (TTM)
BankUnited, Inc. dividend-yield-ttm | BankUnited, Inc. Quote
BKU’s Other Capital Distribution Activities
The bank also has a share repurchase program in place. In September 2022, BKU's board of directors authorized the repurchase of up to an additional $150 million worth of shares with no expiration date. This was followed by another similar authorization announced in May 2022. As of Dec. 31, 2024, $20.2 million worth of shares were left to be repurchased.
Though BKU is unlikely to pursue a significant buyback until it sees stability in the economy, the company's earnings strength is expected to help it sustain efficient capital distribution activities.
As of Dec. 31, 2024, BankUnited had a total debt of $3.6 billion, significantly higher than its cash and cash equivalent balance of $491.1 million. At the end of 2024, its times interest of 2.6X improved sequentially.
Despite the high debt level, the company seems well-poised to meet its debt obligations in the near term, even if the economic situation worsens. This will likely help it to sustain its dividend payouts in the long run.
BKU’s Zacks Rank & Price Performance
In the past year, BankUnited shares have gained 31.3% compared with the industry’s 17.1% growth.
Price Performance
Currently, BKU carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Other Banks Taking Similar Steps
Earlier this month, Independent Bank Corp’s INDB board of directors announced a dividend of 59 cents per share. This reflected a 3.5% hike from the previous payout. The dividend will be paid out on April 7, 2025, to shareholders of record as of March 31.
INDB has increased its dividend payout six times in the past five years. It last increased the dividend by 3.6% to 57 cents per share in March 2024.
Last month, Capital City Bank Group, Inc. CCBG announced a quarterly cash dividend of 24 cents per share, indicating a 4.4% hike from the prior payout of 23 cents. The dividend will be paid out on March 24, 2025, to its shareholders of record as of March 10.
In August 2024, CCBG raised its dividend by 9.5% to 23 cents per share. The company has increased its dividend payout nine times in the past five years.
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