Our analysis is based on comparing Boston Private Financial Holdings, Inc. with the following peers – Century Bancorp, Inc. Class A, Independent Bank Corp., Enterprise Bancorp, Inc., Washington Trust Bancorp, Inc., Webster Financial Corporation, Merchants Bancshares, Inc., Bar Harbor Bankshares, Brookline Bancorp, Inc., Salisbury Bancorp, Inc. and Northeast Bancorp (CNBKA-US, INDB-US, EBTC-US, WASH-US, WBS-US, MBVT-US, BHB-US, BRKL-US, SAL-US and NBN-US).
Boston Private Financial Holdings, Inc.’s dividend yield is 2.71 percent and its dividend payout is 53.95 percent. This compares to a peer median dividend yield of 1.93 percent and a payout level of 45.71 percent. This type of dividend performance might make it a good stock for dividend investors. However, the company’s average dividend quality score of 58 out of a possible score of 100, points to some weakness in the sustainability of its robust payout ratio, and makes its less attractive for dividend investors seeking current income.
Dividend Quality Overview
- Over the last twelve months (prior to March 31, 2017), BPFH-US paid a medium quality dividend, which represents a yield of 2.65% at the current price.
- Dividend quality trend has not been consistent over the last five years. Dividends were paid during each of these years — of these 2 were medium quality and 3 were low quality.
- The ending cash balance, with a dividend coverage of 4.86x, provides a substantial cushion in case of a significant reduction of cash flows in the future.
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Over the last twelve months (prior to March 31, 2017), BPFH-US paid a medium quality dividend.
The source of the company’s cash to support the dividend paid over the last twelve months is operating cash flow (coverage of 2.79x), investing cash flow (coverage of -26.16x), issuance cash flow (coverage of 25.88x) and twelve-month prior cash (coverage of 3.35x), for a total dividend coverage of 5.86x.
BPFH-US‘s issuance cash flow includes outflows from net share buybacks (coverage of -0.05x). Thus, the total coverage including share buybacks is 5.90x, which reflects our assumption that the cash paid for share buybacks is discretionary and could instead be used to pay dividends.
These coverage ratio factors imply that the firm’s net cash inflow from issuance was required (in addition to operating and investment cash) to pay the dividend, which suggests a medium dividend quality.
|Dividend Yield (%)||0.44||1.9||2.31||3.13||2.39||2.71|
|Dividend Payout (%)||6.56||35.29||40.51||48.65||49.38||53.95|
A complete list of metrics and analysis is available on the company page.
Boston Private Financial Holdings, Inc. engages in the business of wealth management. It operates through the following segments: Private Banking; Wealth Management; and Trust; Investment Management; and Wealth Advisory. The Private Banking segment provides services to high net worth individuals privately owned businesses, private partnerships and nonprofit organizations as well as provides financing support for housing, first-time homebuyers, economic development, social services, community revitalization and small businesses. The Wealth Management and Trust segment offers comprehensive wealth management solutions for high net worth individuals and families, including customized investment solutions, wealth planning, trust, and family office services. The Investment Management segment refers to the services given to serve the needs of pension funds, endowments, trusts, foundations and select institutions, mutual funds and high net worth individuals and their families throughout the United States (“U.S.”) and abroad. The Wealth Advisory segment refers to planning-based financial strategies to high net worth individuals and their families, and non-profit institutions such as fee-only financial planning, tax planning, tax preparation, estate and insurance planning, retirement planning, charitable planning and intergenerational gifting and succession planning. The company was founded on September 2, 1987 and is headquartered in Boston, MA.
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