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If you are interested in cashing in on Zions Bancorporation’s (NASDAQ:ZION) upcoming dividend of $0.2 per share, you only have 3 days left to buy the shares before its ex-dividend date, 14 February 2018, in time for dividends payable on the 22 February 2018. Is this future income a persuasive enough catalyst for investors to think about Zions Bancorporation as an investment today? Below, I’m going to look at the latest data and analyze the stock and its dividend property in further detail. See our latest analysis for Zions Bancorporation

How I analyze a dividend stock

Whenever I am looking at a potential dividend stock investment, I always check these five metrics:

• Is their annual yield among the top 25% of dividend payers?

• Has its dividend been stable over the past (i.e. no missed payments or significant payout cuts)?

• Has dividend per share amount increased over the past?

• Is is able to pay the current rate of dividends from its earnings?

• Will it have the ability to keep paying its dividends going forward?

How well does Zions Bancorporation fit our criteria?

Zions Bancorporation has a trailing twelve-month payout ratio of 16.06%, which means that the dividend is covered by earnings. Going forward, analysts expect ZION’s payout to increase to 30.11% of its earnings, which leads to a dividend yield of around 2.08%. In addition to this, EPS should increase to $3.61. The higher payout forecasted, along with higher earnings, should lead to greater dividend income for investors moving forward. Reliablity is an important factor for dividend stocks, particularly for income investors who want a strong track record of payment and a positive outlook for future payout. Not only have dividend payouts from Zions Bancorporation fallen over the past 10 years, it has also been highly volatile during this time, with drops of over 25% in some years. These characteristics do not bode well for income investors seeking reliable stream of dividends. Relative to peers, Zions Bancorporation generates a yield of 1.55%, which is on the low-side for Banks stocks.

Next Steps:

After digging a little deeper into Zions Bancorporation’s yield, it’s easy to see why you should be cautious investing in the company just for the dividend. On the other hand, if you are not strictly just a dividend investor, the stock could still be offering some interesting investment opportunities. Given that this is purely a dividend analysis, I urge potential investors to try and get a good understanding of the underlying business and its fundamentals before deciding on an investment. Below, I’ve compiled three key factors you should further examine: