FIRST US BANCSHARES, INC. DECLARES CASH DIVIDEND
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Insights
The declaration of a cash dividend by First US Bancshares, Inc. is a significant indicator of the company's current financial health and its commitment to returning value to shareholders. A consistent history of dividend payments, such as the thirty-ninth consecutive quarter mentioned, often signals a stable and reliable income stream, which can be attractive to income-focused investors. The dividend yield, calculated as the annual dividends per share divided by the stock price, is a key metric used by investors to assess the return on investment from dividends relative to the company's stock price.
However, the dividend amount and frequency should be evaluated against the company's earnings and cash flow to determine sustainability. A payout ratio, which measures the proportion of earnings paid out as dividends, above industry norms could indicate potential stress on the company's finances if earnings were to decline. Conversely, a low payout ratio may suggest room for future dividend growth or that the company is reinvesting earnings back into the business for growth.
When analyzing the impact of dividend announcements on the stock market, it's important to consider investor sentiment and market conditions. Dividend announcements can serve as a signal to the market regarding management's confidence in the company's future earnings and cash flow. As such, they can affect the stock price both positively and negatively, depending on the context of the announcement and market expectations.
For instance, if the announced dividend is in line with or exceeds market expectations, it may lead to a positive reaction and a potential increase in the stock price. On the other hand, if the dividend is lower than expected or if there are concerns about the sustainability of future dividends, the stock price may be negatively impacted. Additionally, market response may vary depending on the overall economic climate, with dividends being more valued during times of market volatility or low-interest rates.
"We are pleased to announce a dividend for the thirty-ninth consecutive quarter" stated James F. House, the Company's President and Chief Executive Officer. "We will continue to evaluate future dividend payments to ensure the Company's shareholders are rewarded, while maintaining a strong capital base," concluded Mr. House.
About First US Bancshares, Inc.
First US Bancshares, Inc. is a bank holding company that operates banking offices in
Forward-Looking Statements
This press release contains forward-looking statements, as defined by federal securities laws. Statements contained in this press release that are not historical facts are forward-looking statements. These statements may address issues that involve significant risks, uncertainties, estimates and assumptions made by management. The Company undertakes no obligation to update these statements following the date of this press release, except as required by law. In addition, the Company, through its senior management, may make from time to time forward-looking public statements concerning the matters described herein. Such forward-looking statements are necessarily estimates reflecting the best judgment of the Company's senior management based upon current information and involve a number of risks and uncertainties.
Certain factors that could affect the accuracy of such forward-looking statements and cause actual results to differ materially from those projected in such forward-looking statements are identified in the Company's filings with the Securities and Exchange Commission ("SEC"), and forward-looking statements contained herein or in other public statements of the Company or its senior management should be considered in light of those factors. Such factors may include risk related to the Company's credit, including that if loan losses may be greater than anticipated; the impact of national and local market conditions on the Company's business and operations; the rate of growth (or lack thereof) in the economy generally and in the Company's service areas; strong competition in the banking industry; the impact of changes in interest rates and monetary policy on the Company's performance and financial condition; the discontinuation of LIBOR as an interest rate benchmark; the impact of technological changes in the banking and financial service industries and potential information system failures; cybersecurity and data privacy threats; the costs of complying with extensive governmental regulation; the impact of changing accounting standards and tax laws on the Company's allowance for credit losses and financial results; the possibility that acquisitions may not produce anticipated results and result in unforeseen integration difficulties; and other risk factors described from time to time in the Company's public filings, including, but not limited to, the Company's most recent Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q. Relative to the Company's dividend policy, the payment of cash dividends is subject to the discretion of the Board of Directors and will be determined in light of then-current conditions, including the Company's earnings, leverage, operations, financial conditions, capital requirements and other factors deemed relevant by the Board of Directors. In the future, the Board of Directors may change the Company's dividend policy, including the frequency or amount of any dividend, in light of then-existing conditions.
Contact: | Thomas S. Elley |
(205) 582-1200 |
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SOURCE First US Bancshares, Inc.
FAQ
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