StoneCastle Financial Invests In Best Run Banks

Every New York stock exchange trading day I'm posting a daily dividend stock or fund review. I'll share the three chief qualities of just one equity or fund that could be selected for a dividend stock portfolio I've named the Safari to Sweet Success.

This week my Safari portfolio has an opening for a company in the financial services sector.

That sector includes nineteen industries all related to managing money. Industries include: asset management; banks either global or from any of seven regions, capital markets, credit services, financial exchanges, insurance in six specializations, savings banks, and specialty finance.

Today I'm reviewing a non-diversified closed-end management investment company named StoneCastle Financial Corp., its trading ticker symbol is BANX.

StoneCastle Financial's investment management objective is to provide stockholders with current income, and to a lesser extent capital appreciation through investment in U.S. community banks.

StoneCastle Financial Corp is advised by StoneCastle Asset Management, LLC and is headquartered in New York City.

I use three primary keys to measure dividend equities or funds like StoneCastle Financial (BANX): 

(1) Price

(2) Dividends

(3) Returns

BANX Price

StoneCastle's price at Friday's market close was $21.12 per share. The company has made money for investors. A year ago its price was $19.55. Meaning it gained$1.57 per share in the past year.If BANX does the same in the coming year its price will increase from that $21.12 to $22.69 per share or about 7.4%.

BANX Dividends

StoneCastle's most recent quarterly dividend was $0.38 declared in December and paid out January 3rd.  

The annual dividend for 2018 is estimated at $1.52 payable in March, June, September, and January at $0.38 per quarter.

The yield from that $1.52 annual dividend will be 7.2% at Friday's $21.12 price.

Gains For BANX?

Adding the $1.52 dividend to the $1.57 estimated year over year price gain shows a potential $3.09 gross gain for the coming year.  

Now we must subtract the cost to trade StoneCastle (BANX) shares. 

A$1,000.00 invested at Friday's $21.12 price bought 47 shares. 

Those 47 shares will be hit with a broker fee of $5 at purchase and another $5 at sale for a per share cost of about $0.21 per share

Subtracting that $0.21 brokerage cost from the estimated $3.09 gross leaves a net gain to 2019 of $2.88 X 47 shares = $135.36 or a 13.5% net gain on a $992.64 investment.

Therefore, StoneCastle Financial Corp. (whose ticker symbol is BANX), shows a possible 13.5% gain by my simple year over year calculation with a 7.2% dividend included. 

Four analysts cover this stock and two say it will outperform and two say buy. Their consensus price target into 2019 is $22.75 or $0.06 higher than the year-over-year estimate of $22.69.

These forward-looking numbers are conjecture based on past year performance. The actual results remain to be seen.They could turn out to prove to be far lower. More study is required for you to determine if StoneCastle Financial Corp. (BANX) is worth your time and money.