BCB Bancorp, Inc.'s (NASDAQ:BCBP) investors are due to receive a payment of $0.16 per share on 15th of August. Based on this payment, the dividend yield will be 3.4%, which is fairly typical for the industry.

Check out our latest analysis for BCB Bancorp

BCB Bancorp's Earnings Will Easily Cover the Distributions

We aren't too impressed by dividend yields unless they can be sustained over time.

BCB Bancorp has a long history of paying out dividends, with its current track record at a minimum of 10 years. Past distributions do not necessarily guarantee future ones, but BCB Bancorp's payout ratio of 28% is a good sign as this means that earnings decently cover dividends.

Looking forward, EPS is forecast to rise by 17.9% over the next 3 years. Analysts forecast the future payout ratio could be 25% over the same time horizon, which is a number we think the company can maintain.

BCB Bancorp Has A Solid Track Record

Even over a long history of paying dividends, the company's distributions have been remarkably stable. The annual payment during the last 10 years was $0.48 in 2012, and the most recent fiscal year payment was $0.64. This works out to be a compound annual growth rate (CAGR) of approximately 2.9% a year over that time. Dividends have grown relatively slowly, which is not great, but some investors may value the relative consistency of the dividend.

The Dividend Looks Likely To Grow

The company's investors will be pleased to have been receiving dividend income for some time. BCB Bancorp has impressed us by growing EPS at 23% per year over the past five years. Earnings have been growing rapidly, and with a low payout ratio we think that the company could turn out to be a great dividend stock.

We Really Like BCB Bancorp's Dividend

Overall, we think that this is a great income investment, and we think that maintaining the dividend this year may have been a conservative choice. Distributions are quite easily covered by earnings, which are also being converted to cash flows. All of these factors considered, we think this has solid potential as a dividend stock.

Investors generally tend to favour companies with a consistent, stable dividend policy as opposed to those operating an irregular one. Still, investors need to consider a host of other factors, apart from dividend payments, when analysing a company. Companies that are growing earnings tend to be the best dividend stocks over the long term. See what the 3 analysts we track are forecasting for BCB Bancorp for free with public analyst estimates for the company. If you are a dividend investor, you might also want to look at our curated list of high yield dividend stocks.