Are you an income investor? Here are two bank stocks with respectable dividends you might like to explore.
People's United Financial (PBCT)
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It provides commercial banking, retail and business banking. It operates in three segments: Commercial Banking; Retail and Business Banking; and Wealth Management. (Yahoo Finance)
This first quarter of 2012 saw earnings per share report of 18 cents. This was in line with the last quarter when it was a penny less reporting at 17 cents. If there were any negatives for the quarter, it(click to enlarge) would have to be in(click to enlarge) lower revenues do to a reduction in net interest income. As the future progresses, the company should see growth take place through loans and deposits as the economy recovers. Through the slow economic times, the company has taken advantage of 'opportunistic acquisitions' and cost reduction measures to help keep it competitive.
With a forward annual dividend rate of 5.2%; a payout ratio of 107%; and a great Debt/Equity Ratio compared to the industry as a whole (0.12 to 1.10) this is a good dividend company to own.
Hudson City Bancorp (HCBK)
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Hudson City Bancorp, Inc. operates as the bank holding company for Hudson City Savings Bank that provides retail banking services in the United States. The company's loan portfolio consists of one- to four-family residential first mortgage loans; multi-family and commercial mortgage loans; construction loans; consumer loans consisting of fixed-rate second mortgage loans. (Yahoo Finance)
The company's 1Q earnings were about 15 cents per share, just as expected but incurred a loss of $1.13 per share based upon balance sheet restructuring. Hudson City's results reflect the impact of the debt pay off however, with the continuation of the low interest environment; the company anticipates continuing margin compression in 2012.
The debt payoff was a strong strategic move for the company. it has paid off $4.3 billion debt last December as part of its effort to restructure the balance sheet. This restructuring would condense higher-cost structured borrowings and in turn boost net interest income in the coming quarters as interest expenses goes down. The company a good business model and is conservative in its underwriting procedures. With a forward dividend of 4.7% it is a company worth taking a look at if you are an income investor.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
