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Dividend Champion Banks: The Best Of The Best In Credit Quality

Published Wed, 09 Sep 2020 15:55:44 -0400 on Seeking Alpha

Seeking AlphaDividend StrategyDividend Champion Banks: The Best Of The Best In Credit QualitySep. 9, 2020 3:55 PM ET|| Includes: AROW, BMTC, CFR, FLIC, FMCB, UMBFby: Richard J. ParsonsRichard J. Parsons Banks10 X Risk Management Llc.cls-1{fill:#024999;}SummaryHere is my third Seeking Alpha article spotlighting the nation's 30 Dividend Champion banks.
While all the Dividend Champion banks have impressive track records navigating business cycles and managing credit, a few stand out as Best of the Best.
Here is a list of High Quality Dividend Champion banks with excellent credit history that are selling at deep discount to historic valuation.

A Series of Articles Spotlighting Dividend Champion Banks
Having wrapped up the initial research phase for a second edition to my 2016 book about bank investing, I am now drilling deeper into major themes that may have the greatest benefit to long-term bank investors.
One of those themes builds on the Dividend Champion banks that I spotlighted in chapter 8 of the book. As I pointed out in the first Seeking Alpha article, Dividend Champion bank valuations are currently at historic lows.
The question for investors: Are the valuations low because these banks are under-appreciated or because they are a value trap?
Banks: Opportunity or Value Trap?
The risk that the banking sector is a value trap is significant today.
It is possible that the industry has entered a new paradigm that results in a permanent reset of bank valuations. This new paradigm may reflect the investment community's skepticism that banks cannot overcome a low interest rate world where the risks of stagflation or deflation are real.
If there is a new paradigm for bank valuations, then the current discount of 35% to 45% for Dividend Champion banks (and close to 50% for the sector) may not reflect an opportunity but a value trap.
On the other hand, if there is a potential for the banking sector to see a reversion to... Read more

Stock name Last trade   P/E Earnings/Share Dividend/Share Dividend yield
CULLEN/FROST BANKERS 90.05   12.7 7.11 2.84 3.20
ARROW FINANCIAL 35.31   14.4 2.46 1.04 3.09
THE FIRST OF LONG ISLAND 23.75   0.0 0.00 0.68 2.97
UMB FINANCIAL 66.08   16.4 4.02 1.20 1.88


Older articles featuring Cullen/frost Bankers (CFR):
Dividend Champion And Contender Highlights: Week Of September 13
Contrarian Play: 10 Best Of The Best Dividend Champion Banks
Contrarian Value Play: Dividend Champion Banks For Double-Digit Return
Dividend Champion And Contender Highlights: Week Of August 23
The 14 Best High-Yield Dividend Aristocrats Retirees Can Safely Buy Right Now
Stocks With A Perfect Dividend Payout Ratio
Dividend Champion And Contender Highlights: Week Of June 7
Dividend Champion And Contender Highlights: Week Of May 24
Insiders At Quality, Reliable Dividend-Paying Banks Buying Shares
Investors Can Expect Dividend Increases From 11 Companies In Late April