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Dividend Watch: The Stock Dividend & High-Yield Bank Dividends (VLY)

Administrator — Wed, 13 Apr 2011 14:52:35 +0000

Valley National Bancorp (NYSE: VLY) was recently featured in our dividend watch for the already-high dividend yields that came out before the rest of the TARP banks were allowed to reinstate their payouts. We had noted that the bank also paid out a stock dividend as well. The news today is that Valley National is paying a 5% stock dividend to its shareholders.

This is the holding company for Valley National Bank with close to 200 branches in New York and New Jersey. Where this one gets interesting is that it has gone one for far longer than we even looked. The bank said that the stock dividend has been paid out each and every year since 1992. The bank also has a cash dividend of about 5% on an annualized basis.

Its board approved the payout as payable May 20, 2011 for shareholders of record on May 6, 2011. Shares are down 0.5% at $13.73 so far today and its 52-week trading range is $12.33 to $16.19.

The stock’s performance was greatly interrupted by the recession. Still, at least the bank is intent in returning capital to shareholders and making shareholder-friendly decisions.

JON C. OGG

Filed under: Banking, Dividend, Shareholder Issues, Stock Splits Tagged: VLY

Real Banks With Real Dividends! (JPM, MTB, VLY, NYB, HCBK, PBCT, FNFG, AF, NWBI, CFR, UBSI, FMER, PRK, TRMK, HBHC, FNB, BOH, RY, BNS, BMO, CM)

Administrator — Thu, 17 Feb 2011 15:28:18 +0000

Most investors today believe that none of the banks are paying high-yielding dividends any longer. While it is true that J.P. Morgan Chase & Co. (NYSE: JPM) is going to reinstate its dividend as soon as it is allowed to by regulators, its paltry 0.4% dividend yield just doesn’t entice income buyers today. There is also a risk that regulators or politicians will opt to keep the heat on money-center banks to keep reserves aside or to make more loans to businesses rather than using cash to buyback stock or juice up the dividend.

We wanted to take a look at “all those other banks” out there that might have avoided the trouble that the big money center banks got into. The screen pointed to M&T Bank Corp. (NYSE: MTB), Valley National Bancorp (NYSE: VLY), New York Community Bancorp Inc (NYSE: NYB), Hudson City Bancorp, Inc. (NASDAQ: HCBK), People’s United Financial Inc. (NASDAQ: PBCT), First Niagara Financial Group (NASDAQ: FNFG), Astoria Financial Corporation (NYSE: AF), Northwest Bancshares, Inc. (NASDAQ: NWBI), Cullen/Frost Bankers, Inc. (NYSE: CFR), United Bankshares Inc. (NASDAQ: UBSI), FirstMerit Corporation (NASDAQ: FMER), Park National Corp. (NYSE: PRK), Trustmark Corporation (NASDAQ: TRMK), Hancock Holding Co. (NASDAQ: HBHC), F.N.B. Corporation (NYSE: FNB) and Bank of Hawaii Corporation (NYSE: BOH). In Canada there is Royal Bank of Canada (NYSE: RY), The Bank Of Nova Scotia (NYSE: BNS), Bank of Montreal (NYSE: BMO), and Canadian Imperial Bank of Commerce (NYSE: CM).It turns out that there are still many banks around the country that do pay higher dividends at above-market yields.

Our screen boiled down to a simple process. We took a 3.0% Yield hurdle because that is what was implied as a future yield by JPMorgan this week if you use forward earning projections. To avoid the micro-regional risks and to avoid the “so small no one cares if they fail” we also made a market cap hurdle of $1.0 billion. After this we took a look at forward earnings expectations and also looked in the past to see what happened to their common stock dividends during the Great Recession when bank failure risks were systematic.

M&T Bank Corp. (NYSE: MTB) is based in Buffalo, NY and is the holding company for M&T Bank. As of a year ago it had 793 banking offices in New York, Pennsylvania, Maryland, Delaware, New Jersey, Virginia, West Virginia, and the District of Columbia, as well as a branch in George Town, Cayman Islands. The company is in the process of acquiring another.

Share price of $89.85 compares to 52-week range of $72.03 to $96.15
Market Cap is $10.76 billion
Thomson Reuters sees 2011 at $6.12 EPS and $3.77 billion in revenues
Dividend of $0.70/quarter generates a yield of 3.2%
Dividend history during recession was unchanged

Valley National Bancorp (NYSE: VLY) is the bank holding company for Valley National Bank and it had 197 full-service banking branches a year ago located throughout New Jersey and New York.

Share price of $13.51 compares to 52-week range of $12.33 to $16.19
Market Cap is $2.2 billion
Thomson Reuters sees 2011 at $0.84 EPS and $550.98 million in revenues
Dividend of $0.18/quarter generates a yield of about 5.3%
Dividend history during recession was not effectively interrupted at all and it continued to pay a 5% stock dividend.

New York Community Bancorp Inc (NYSE: NYB) is the bank holding company for York Community Bank and New York Commercial Bank and as of a year ago it had 241 community bank branches and 35 commercial bank branches throughout New York.

Share price of $18.92 compares to 52-week range of $14.40 to $19.33
Market Cap is $8.24 billion
Thomson Reuters sees 2011 at $1.33 EPS and $1.25 billion in revenues
Dividend of $0.25/quarter generates a yield of 5.4%
Dividend history during recession was unchanged at $0.25 per quarter since 2004.

Hudson City Bancorp, Inc. (NASDAQ: HCBK) is the bank holding company for Hudson City Savings Bank and as of a year ago it had 95 branches located in 17 counties throughout the State of New Jersey.

Share price of $11.40 compares to 52-week range of $10.80 to $14.75
Market Cap is $5.6 billion
Thomson Reuters sees 2011 at $0.77 EPS and $966.6 million in revenues
Dividend of $0.15/quarter generates a yield of 5.3%
Dividend history during recession was actually raised during 2009 when others were eliminating or cutting the dividend. The dividend has been this rate since mid-2009.

Filed under: Banking, Dividend, Editor's Picks, Financial Stocks, Research Tagged: AF, BMO, BNS, BOH, CFR, CM, FMER, FNB, FNFG, HBHC, HCBK, JPM, MTB, NWBI, NYB, PBCT, PRK, RY, TRMK, UBSI, VLY

S&P Looking For More Bank Losses (WFC, CMA, USB, BBT, RF, COF, FITB, HBAN, SNV, WTNY, FAS)

247wallst — Wed, 17 Jun 2009 16:40:14 +0000

Standard & Poor’s may still have at least some relevance in its debt ratings. This morning we saw a wave of downgrades at banks by the debt ratings agency on systematic-risk and non-systematic risk. We tried to shorten this up to the most concise report in rating groups as this is hitting many of the bank stocks pretty hard this morning. Wells Fargo & Co. (NYSE: WFC), Comerica (NYSE: CMA), USBancorp (NYSE: USB), BB&T Corp. (NYSE: BBT), Regions Financial Corp. (NYSE: RF), Capital One Financial Corp. (NYSE: COF), Fifth Third Bancorp (NASDAQ: FITB), Huntington Bancshares Inc. (NASDAQ: HBAN), Synovus Financial Corp. (NYSE: SNV) and Whitney Holding Corp. (NASDAQ: WTNY) were all in the wave of S&P downgrades. This news has the extremely volatile Direxion Daily Financial Bull 3X Shares (NYSE: FAS) triple leverage financial sector ETF down 7% at $8.60.

Wells Fargo & Co. (NYSE: WFC) was cut to AA- from AA. It is off watch but the outlook is negative. Comerica (NYSE: CMA) was cut to A- from A, and it is off watch and the outlook is negative. USBancorp (NYSE: USB) was cut to A+ from AA, and it is off watch and the outlook is stable. BB&T Corp. (NYSE: BBT) was cut to A from A+, and is off watch and the outlook is stable.

Regions Financial Corp. (NYSE: RF) was cut to BBB+ from A, and it is off watch but the outlook is negative. Capital One Financial Corp. (NYSE: COF) was cut to BBB from BBB+. Fifth Third Bancorp (NASDAQ: FITB) was cut to BBB from A- and the outlook is negative. KeyCorp (NYSE: KEY) was cut to BBB+ from A-, and is off watch and the outlook is negative.

Huntington Bancshares Inc. (NASDAQ: HBAN) is now junk. S&P cut it to BB+ from BBB, and it is off watch but the outlook is negative. Synovus Financial Corp. (NYSE: SNV) and Whitney Holding Corp. (NASDAQ: WTNY) were also cut to Junk Rating.

Associated Banc Corp. (ASBC), Astoria Financial (AF), PNC Financial (PNC), Susquehanna (SUSQ), Valley National Bancorp (VLY), Webster Financial (WBS), and Wilmington Trust (WL) were also part of this major downgrade.

It seems that S&P has figured out that the future of banks will not be as good as things were in the past. It sees stress tests pointing to more pain ahead and losses above current expectations. S&P sees weaker operating conditions ahead. Before you go run into a panic about write-downs and losses, keep in mind that S&P has had many of these banks under review for more than six months. It is also not exactly as though S&P (and Moody’s for that matter) was ahead of the curve in catching the banking and lending crisis that got us where we are today.

Jon C. Ogg

Posted in Analyst Calls, Banking, Financial Stocks Tagged: AF, ASBC, BBT, CMA, COF, FAS, FITB, HBAN, PNC, RF, SNV, SUSQ, USB, VLY, WBS, WFC, WL, WTNY

Financial Downgrades (BAC, BBT, CLMS, CMA, FITB, BEN, STI, VLY)

247wallst — Wed, 10 Sep 2008 06:33:05 +0000

There were more downgrades in financial stocks, but these were the larger names that saw estimates or ratings cut by analysts this morning:

Bank of America (BAC) Cut to Underperform at KBW.
BB&T (BBT) Cut to Underperform at KBW.
Calamos Asset Management (CLMS) Cut to Sell at Goldman Sachs.
Comerica (CMA) Cut to Market Perform at KBW.
Fifth Third Bancorp (FITB) Cut to Market Perform at KBW.
Franklin Resources (BEN) Cut to Neutral at Goldman Sachs.
Suntrust Banks (STI) Cut to Underperform at KBW.
Valley National Bancorp (VLY) Cut to Underperform at KBW.

Jon C. Ogg
September 10, 2008

Pre-Market Analyst Calls (June 15, 2007)

247wallst — Fri, 15 Jun 2007 06:26:48 +0000

ABCO started as Outperform at CIBC.
AXTI started as Buy at First Albany.
BKD started as Buy at Jefferies.
BOOM started as Buy at First Albany.
CQB started as Buy at Morgan Joseph.
EXBD started as Sector Perform at CIBC.
FCN started as Outperform at CIBC.
FRE raised to Outperform at FBR.
HCBK started as Underperform at Bear Stearns.
HNSN started as Buy at Oppenheimer.
HOMB started as Sector Perform RBC.
INTC raised to Buy at Goldman Sachs; stock up almost 2%.
IIVI started as Buy at First Albany.
KNDL raised to Buy at Jefferies.
LGCY started as Buy at Oppenheimer.
NFS raised to Buy at Citigroup.
NFLX raised to Buy at Soleil.
PNX cut to Hold at Citigroup.
PTRY raised to Buy at Jefferies.
SFG raised to Buy at Citigroup.
VLY started as Peer Perform at Bear Stearns.
WSO cut to Hold at BB&T.

Jon C. Ogg
June 15, 2007