LUBBOCK, Texas - South Plains Financial, Inc. (NASDAQ:SPFI), the holding company for City Bank, announced today that its Board of Directors approved a 7% increase in its quarterly cash dividend. The dividend of $0.15 per share of common stock is scheduled to be paid on November 12, 2024, to shareholders of record at the close of business on October 28, 2024.
This decision follows a prior dividend declared in July 2024 and represents a continuation of the company's practice of returning value to its shareholders. South Plains Financial operates as a bank holding company through City Bank, which serves various Texas markets such as West Texas, Dallas, El Paso, Greater Houston, the Permian Basin, and College Station, as well as the Ruidoso market in New Mexico.
City Bank offers a broad spectrum of financial services, catering to the needs of small and medium-sized businesses and individual consumers. These services include commercial and retail banking, in addition to investment, trust, and mortgage services.
The increase in the dividend reflects South Plains Financial's commitment to its shareholders and indicates a positive stance on its financial health. Investors typically view such increases as a sign of a company's strong financial performance and confidence in its future earnings.
The information for this article is based on a press release statement from South Plains Financial, Inc.
In other recent news, South Plains Financial Inc . reported a second quarter increase in its diluted earnings per share (EPS) to $0.66, driven by robust organic loan growth and an improved net interest margin (NIM). Piper Sandler, a financial services firm, reaffirmed its Overweight rating on the company's shares and raised the price target to $36.00. The firm also revised the earnings per share (EPS) estimates for the years 2024 and 2025 to $2.48 and $2.56, respectively.
These developments followed discussions with South Plains Financial's senior management and reflect the company's potential for growth, supported by a stable net interest margin and a flexible balance sheet. The bank's strategic moves, including potential mergers and acquisitions, are seen as additional growth drivers.
Furthermore, the bank declared a quarterly dividend of $0.14 per share, indicating a continued return to its shareholders. Piper Sandler's analysis suggests that South Plains Financial's approach to management is generating investor enthusiasm. However, executives from South Plains Financial and Citibank emphasized a cautious approach to capital management and growth, considering upcoming election and geopolitical uncertainties.
InvestingPro Insights
South Plains Financial's recent 7% dividend increase aligns with its track record of shareholder value creation. According to InvestingPro data, the company has raised its dividend for 5 consecutive years, demonstrating a consistent commitment to returning capital to investors. This trend is further supported by a dividend yield of 1.6% and a dividend growth rate of 7.69% over the last twelve months.
The company's financial health appears robust, with a price-to-earnings ratio of 12.67, suggesting a relatively attractive valuation compared to industry peers. South Plains Financial's profitability is evident, with the company reporting an operating income margin of 31.63% for the last twelve months as of Q2 2024.
InvestingPro Tips highlight that South Plains Financial is trading near its 52-week high, with a significant price uptick of 39.69% over the last six months. This performance indicates strong market confidence in the company's prospects. Additionally, analysts predict the company will remain profitable this year, which could further support the stock's momentum.
For investors seeking a more comprehensive analysis, InvestingPro offers 8 additional tips for South Plains Financial, providing deeper insights into the company's financial outlook and market position.
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