With their high dividends and low valuations, the financial sector remains a fruitful place for investors to find growing income. And our latest Best Dividend Capture Pick is no different. The firm has continued to expand, recently celebrating its 160th year of operation. And while it hasn’t grown its payout for all those years, it has managed to reward its shareholders through dividend increases and buybacks since the end of the Great Recession.
You can check out the Best Dividend Capture Stocks List to explore all the stocks.
The secret to our pick’s success remains its operating area. Our pick happens to be a regional bank, and regional banks are often the lifeblood of their communities and towns, providing loans and savings products to grow their operating areas. For our pick, that region happens to be Upstate New York and into Pennsylvania and New England. These relatively affluent areas feature sticky deposits and strong economies, allowing our pick to prosper through its loan portfolio and other traditional banking businesses.
The best part is that our pick has plenty of growth potential.
Some of its growth is coming from the technology sector. Our pick operates right in the middle of the Upstate NY semiconductor chip corridor and New England build-out. These regions are quickly becoming a hotbed of semiconductor manufacturing and renewable energy products growth, bringing new wealth into the area — and our pick is ready to benefit. Moreover, it has continued to use M&A to boost its position in these areas. Our pick has also benefited from its expansion into fee-based financial markets, such as wealth management, insurance sales, and trust services. All of which have boosted its bottom line and dividend-paying ability.
With growth potential, strong cash generation, and a vast operating region, our pick has continued to find investor support. As such, it has become a wonderful dividend capture play. A dividend capture strategy involves buying a stock before its ex-dividend date and then selling it after it has recovered the payout. With an ex-dividend date of Monday, March 3, our pick is primed for the strategy, as is evident from its historical track record of a recovery period within an average of 8.1 days after going ex-dividend.
For investors looking for a quick total return of income and capital appreciation, our latest regional banking play could be a lucrative option.
