Stellar Bancorp, Inc. Declares Quarterly Dividend and New Share Repurchase Program

Rhea-AI Summary

Stellar Bancorp announced a quarterly cash dividend of $0.13 per share, payable on June 28, 2024, to shareholders of record as of June 14, 2024. Additionally, the Board of Directors authorized a new share repurchase program allowing the repurchase of up to $60 million of common stock through May 31, 2025. This follows an existing program also permitting $60 million in repurchases through May 31, 2024. Repurchases can be made in various forms, including open market transactions and block trades, depending on factors such as price, market conditions, and corporate priorities.

Positive

• Quarterly dividend declared: $0.13 per share.
• Dividend payment date: June 28, 2024.
• New share repurchase program: up to $60 million through May 31, 2025.
• Existing share repurchase program: up to $60 million through May 31, 2024.
• Flexibility in repurchase methods, including open market and block trades.

Negative

• Dividend amount is relatively small ($0.13 per share).
• Share repurchase program does not obligate the company to a specific dollar amount or number of shares.
• Potential for program suspension, modification, or discontinuation at any time.

Insights

Financial Analyst

The announcement of a quarterly cash dividend of $0.13 per share and a new share repurchase program signals Stellar Bancorp's commitment to returning value to its shareholders. The dividend provides immediate and tangible returns for investors, which is often viewed positively in the market. Furthermore, the share repurchase program, which authorizes repurchases up to $60 million, indicates the company's confidence in its financial health and future prospects. Repurchasing shares can improve earnings per share (EPS) by reducing the number of outstanding shares, which may lead to a higher stock price. However, the effectiveness of share repurchases is contingent on the price paid for the shares and the company's ability to deploy capital efficiently elsewhere. Investors should also watch the balance between these buybacks and other uses of cash like investments in growth initiatives.

From a financial perspective, these actions are positive but should be tempered with scrutiny of the company's overall capital allocation strategy.

Market Research Analyst

In the context of the broader market, Stellar Bancorp's dividend declaration and share repurchase program reflect common strategies employed by companies to enhance shareholder value. Dividends provide a steady income stream to investors, often attracting income-focused investors. Meanwhile, share repurchases can signal to the market that management believes the stock is undervalued. However, it's important to consider the potential impact on liquidity and market conditions. The timing and volume of share repurchases can influence stock price and market conditions will play a significant role in the execution of such programs. For retail investors, understanding these market dynamics is important as they assess the potential for price appreciation versus income generation from dividends.

Overall, these announcements align with shareholder-friendly actions but should be evaluated in the context of the company's overall financial health and strategic priorities.

HOUSTON--(BUSINESS WIRE)-- Stellar Bancorp, Inc. (the “Company”) (NYSE: STEL) today announced that on May 23, 2024, its Board of Directors declared a quarterly cash dividend in the amount of $0.13 per share of common stock. The dividend will be payable on June 28, 2024 to the Company’s shareholders of record as of the close of business on June 14, 2024.

The Company also announced that its Board of Directors authorized a new share repurchase program under which the Company may repurchase up to $60 million of the Company’s common stock through May 31, 2025. The Company has an existing share repurchase program under which the Company may repurchase up to $60 million of the Company’s common stock through May 31, 2024.

Repurchases under the share repurchase program may be made from time to time at the Company’s discretion in open market transactions, through block trades, in privately negotiated transactions, and pursuant to any trading plan that may be adopted by the Company’s management in accordance with Rule 10b5-1 of the Securities Exchange Act of 1934, as amended, or otherwise. The timing and actual number of shares repurchased will depend on a variety of factors including price, corporate and regulatory requirements, market conditions, and other corporate liquidity requirements and priorities. The share repurchase program does not obligate the Company to acquire a specific dollar amount or number of shares and may be modified, suspended or discontinued at any time.

About Stellar Bancorp, Inc.

Stellar Bancorp, Inc. is a bank holding company headquartered in Houston, Texas. The Company’s principal banking subsidiary, Stellar Bank, provides a diversified range of commercial banking services primarily to small- to medium-sized businesses and individual customers across the Houston, Dallas, Beaumont and surrounding communities in Texas.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the Company’s actual results, performance or achievements to be materially different from any future results, performance or achievements anticipated in such statements. Forward-looking statements speak only as of the date they are made and, except as required by law, the Company does not assume any duty to update forward-looking statements. Such forward-looking statements include, but are not limited to, statements concerning the Company’s plans, objectives, strategies, expectations, intentions and other statements that are not statements of historical fact, and may be identified by words such as “anticipates,” “believes,” “building,” “continue,” “could,” “drive,” “estimates,” “expects,” “extent,” “focus,” “forecasts,” “goal,” “guidance,” “intends,” “may,” “might,” “outlook,” “plan,” “position,” “probable,” “progressing,” “projects,” “prudent,” “seeks,” “should,” “target,” “view,” “will” or “would” or the negative of these words and phrases or similar words or phrases. For a list of factors that could cause actual results to differ materially from those set forth in the forward-looking statements, see the risk factors described in the Company’s most recent Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q and other reports that are filed with the Securities and Exchange Commission. All forward-looking statements are qualified in their entirety by this cautionary statement.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240523269953/en/

IR@stellar.bank

Source: Stellar Bancorp, Inc.

FAQ

What dividend did Stellar Bancorp declare in May 2024?

Stellar Bancorp declared a quarterly dividend of $0.13 per share.

When is the dividend payment date for Stellar Bancorp's latest dividend?

The dividend payment date is June 28, 2024.

What is the record date for Stellar Bancorp's latest dividend?

The record date is June 14, 2024.

How much stock can Stellar Bancorp repurchase under the new program?

Stellar Bancorp may repurchase up to $60 million of common stock under the new program.

What is the duration of Stellar Bancorp's new share repurchase program?

The new share repurchase program is authorized through May 31, 2025.

What factors influence the timing and number of shares repurchased by Stellar Bancorp?

Factors include price, corporate and regulatory requirements, market conditions, and corporate liquidity priorities.