Shares of FS Bancorp (NASDAQ:FSBW), Inc. FSBW rallied 3.6% following the announcement of a new share repurchase plan last week. The board of directors has approved buyback authorization worth $5 million.
Repurchases under the program can be executed either through the open market or privately negotiated transactions, depending on the market conditions and other factors.
FS Bancorp has been rewarding shareholders through regular buybacks. Earlier in January, the bank had authorized 225,000 shares or 5% of issued shares and outstanding common stock (as of Dec 31, 2019) for repurchase, which was set to expire in January 2021. Nonetheless, as of Jun 30, 2020, the company fully utilized this buyback program.
Apart from share repurchase authorizations, FS Bancorp has been paying regular quarterly cash dividend. Since 2014, the company has been increasing its quarterly dividend on an annual basis. The last hike of 5% was announced in January. Considering last day’s closing price of $41.82, FS Bancorp’s dividend yield currently stands at 2.01%.
FS Bancorp’s financials are supported by strong balance sheet. As of Jun 30, the company had total debt worth $160.2 million, higher than the total cash and cash equivalents balance of $126.1 million. Yet, its total debt to total capital of 43.4% at the end of the second quarter improved sequentially. Also, the company’s times-interest-earned of 13.7 at the end of the June quarter improved from the prior quarter.
Given the earnings strength and decent liquidity position, the company will likely be able to sustain the current level of capital deployment program.
Shares of FS Bancorp have jumped 39.9% over the past six months, significantly outperforming the industry’s rally of 6.7%.
Currently, FS Bancorp sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
New Share Buyback Plans by Other Banks
Over the last few weeks, several banks including Home Bancorp (NASDAQ:HBCP), Inc. HBCP, HarborOne Bancorp (NASDAQ:HONE), Inc. HONE and Columbia Financial (NASDAQ:CLBK), Inc.’s CLBK have announced new share repurchase authorizations. Home Bancorp’s board of directors approved the repurchase of up to 444,000 shares of the company’s common stock.
HarborOne Bancorp’s board of directors adopted a share repurchase program, which authorized buyback of up to 2.92 million shares, while Columbia Financial announced authorization to repurchase up to about 5 million shares.
Zacks’ Single Best Pick to Double
From thousands of stocks, 5 Zacks experts each picked their favorite to gain +100% or more in months to come. From those 5, Zacks Director of Research, Sheraz Mian hand-picks one to have the most explosive upside of all.
With users in 180 countries and soaring revenues, it’s set to thrive on remote working long after the pandemic ends. No wonder it recently offered a stunning $600 million stock buy-back plan.
The sky’s the limit for this emerging tech giant. And the earlier you get in, the greater your potential gain.
Click Here, See It Free >>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Home Bancorp, Inc. (HBCP): Free Stock Analysis Report
FS Bancorp, Inc. (FSBW): Free Stock Analysis Report
HarborOne Bancorp, Inc. (HONE): Free Stock Analysis Report
COLUMBIA FINL (CLBK): Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research