Be Sure To Check Out First Community Bankshares, Inc. (NASDAQ:FCBC) Before It Goes Ex-Dividend

First Community Bankshares, Inc. (NASDAQ:FCBC) stock is about to trade ex-dividend in 4 days. The ex-dividend date occurs one day before the record date, which is the day on which shareholders need to be on the company's books in order to receive a dividend. The ex-dividend date is important because any transaction on a stock needs to have been settled before the record date in order to be eligible for a dividend. This means that investors who purchase First Community Bankshares' shares on or after the 13th of November will not receive the dividend, which will be paid on the 27th of November.

The company's next dividend payment will be US$0.33 per share, on the back of last year when the company paid a total of US$2.32 to shareholders. Last year's total dividend payments show that First Community Bankshares has a trailing yield of 5.1% on the current share price of US$45.48. Dividends are an important source of income to many shareholders, but the health of the business is crucial to maintaining those dividends. As a result, readers should always check whether First Community Bankshares has been able to grow its dividends, or if the dividend might be cut.

We've found 21 US stocks that are forecast to pay a dividend yield of over 6% next year. See the full list for free.

Dividends are typically paid from company earnings. If a company pays more in dividends than it earned in profit, then the dividend could be unsustainable. That's why it's good to see First Community Bankshares paying out a modest 38% of its earnings.

Companies that pay out less in dividends than they earn in profits generally have more sustainable dividends. The lower the payout ratio, the more wiggle room the business has before it could be forced to cut the dividend.

See our latest analysis for First Community Bankshares

Click here to see the company's payout ratio, plus analyst estimates of its future dividends.

Have Earnings And Dividends Been Growing?

Businesses with strong growth prospects usually make the best dividend payers, because it's easier to grow dividends when earnings per share are improving. If earnings fall far enough, the company could be forced to cut its dividend. Fortunately for readers, First Community Bankshares's earnings per share have been growing at 10% a year for the past five years.

The main way most investors will assess a company's dividend prospects is by checking the historical rate of dividend growth. In the last 10 years, First Community Bankshares has lifted its dividend by approximately 15% a year on average. It's exciting to see that both earnings and dividends per share have grown rapidly over the past few years.

Final Takeaway

Is First Community Bankshares worth buying for its dividend? Companies like First Community Bankshares that are growing rapidly and paying out a low fraction of earnings, are usually reinvesting heavily in their business. This strategy can add significant value to shareholders over the long term - as long as it's done without issuing too many new shares. In summary, First Community Bankshares appears to have some promise as a dividend stock, and we'd suggest taking a closer look at it.

Ever wonder what the future holds for First Community Bankshares? See what the two analysts we track are forecasting, with this visualisation of its historical and future estimated earnings and cash flow

If you're in the market for strong dividend payers, we recommend checking our selection of top dividend stocks.

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