Source: Investing Published 11/22/2024, 01:06
Stellar Bancorp, Inc. (NYSE: STEL) announced an increase in its quarterly cash dividend from $0.13 to $0.14 per common share. The dividend is scheduled to be paid on December 31, 2024 to shareholders of record as of December 13, 2024.
The bank holding company, headquartered in Houston, Texas, operates primarily through its subsidiary Stellar Bank. The bank provides commercial banking services to small and medium-sized businesses.
as well as individual customers, in Houston, Dallas, Beaumont and other communities in Texas.
The increase in the dividend continues Stellar Bancorp’s commitment to returning value to its shareholders and reflects confidence in the company’s financial stability and future performance. The decision to raise the dividend was made by the company’s board of directors and is a positive adjustment for investors.
This financial move by Stellar Bancorp comes amid its efforts to maintain a steady growth trajectory and establish itself in the competitive banking market in Texas. Shareholders looking to increase their dividend will find this news a sign of the company’s strong position and prudent financial management.
It is important to note that the information contained in this announcement is based on a press release issued by Stellar Bancorp. The company cautions that forward-looking statements are subject to risks, uncertainties and other factors that may affect actual results.
and that such statements are not guarantees of future performance. These forward-looking statements should be considered in light of the risks detailed in Stellar Bancorp’s regulatory filings with the Securities and Exchange Commission.
Investors are encouraged to review the company’s most recent Annual Report on Form 10-K, as well as subsequent quarterly reports on Form 10-Q.
to gain a better understanding of the risk factors that may affect the company’s financial results.
In other recent news, Stellar Bancorp reported strong third-quarter 2024 results.
posting a significant increase in net income to $33.9 million, compared to $29.8 million in the prior-year quarter. The increase was primarily due to a $6 million credit loss provision reversal, indicating a decline in non-performing loans. The company also began share repurchases and plans to redeem $40 million in subordinated debt.
demonstrating a strategic approach to capital management and future growth. Additionally, Stellar Bancorp originated over $300 million in loans.
despite a strategic reduction in commercial real estate lending, and improved its overall risk-adjusted capital ratio to 15.91%. The bank is also exploring merger and acquisition opportunities to strengthen its financing profile and manage expenses.
However, there was a slight increase in loans classified as “specially indicated,” indicating potential risks. Management also anticipates challenges in loan growth due to economic uncertainty but is targeting mid-single digit growth in 2025. Here are some recent developments in Stellar Bancorp’s financial journey.
InvestingPro Insights
Stellar Bancorp’s recent decision to increase its quarterly dividend aligns well with its financial performance and market position. According to InvestingPro data, the company has a market cap of $1.57 billion and has shown strong profitability with a price-to-earnings ratio of 12.72. A relatively low price-to-earnings ratio suggests the stock may be undervalued relative to its earnings potential.
InvestingPro’s advice highlights that Stellar Bancorp has shown “strong returns over the past three months,” with the data confirming a total price return of 17.31% over that period. This positive momentum extends further, with a notable return of 28.47% over the past six months. These numbers underscore the company’s strong performance and may explain the board’s confidence in raising the dividend.
The company’s strong financial position is evidenced by its profitability over the past twelve months.
as noted in another InvestingPro tip. With an operating income margin of 42.42% for the past twelve months as of Q3 2024.
Stellar Bancorp demonstrates operational efficiency and strong earnings potential, supporting its ability to increase shareholder returns through higher dividends.
It is worth noting that InvestingPro offers additional insights, with 8 additional Stellar Bancorp tips available, providing investors with a comprehensive view of the company’s financial landscape and market position.
