Ameris Bancorp Cheers Investors With Robust Capital Actions

Zacks Equity Research

Ameris Bancorp ABCB has announced enhanced capital deployment plans. The company announced a quarterly cash dividend of 15 cents per share, up 50% from the prior payout. The dividend will be paid on Oct 10 to shareholders of record as on Sep 30.

Based on the last day’s closing price of $39.15 per share, the company now has a dividend yield of 1.53%. Ameris Bancorp had earlier increased dividend in September 2016 at the same rate to 10 cents per share.

Notably, following the 2008 financial crisis, the company had stopped paying dividend. It resumed the same in 2014 with payment of 5 cents per share as quarterly dividend.

Concurrent with this dividend hike, Ameris Bancorp authorized a $100 million worth of new share repurchase program. The authorization will expire on Oct 31, 2020.

This replaces the bank’s earlier buyback plan of $100 million, which was announced in October 2018. Over the past year, Ameris Bancorp repurchased $10.4 million worth of shares under its old plan, which was set to expire in October this year.

Given the strong balance sheet position, Ameris Bancorp’s latest capital deployment action will enhance shareholder value. Further, the company has been growing inorganically.

Over the last two years, Ameris Bancorp closed the acquisitions of Atlantic Coast Financial Corporation, Hamilton State Bancshares, Inc. and Fidelity Southern Corporation. All these deals are expected to be accretive to the company’s financials.

Shares of Ameris Bancorp have rallied 23.6%, outperforming the industry’s growth of 16.7%.

Currently, Ameris Bancorp carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Some other banks that raised dividends over the recent past are Washington Federal, Inc. WAFD, BancorpSouth Bank BXS and Huntington Bancshares HBAN. These companies hiked quarterly dividends in the range of 5-9%.

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