Image Source: Pixabay

Chuck Carnevale reviews six regional banks that are all Dividend Champions—companies that have raised their dividends for at least 25 consecutive years. These banks generally yield nearly double the S&P 500, with only one yielding below 3%, and all are trading at fair or attractive valuations.

The featured banks are:

• Arrow Financial (AROW)
• Community Financial System (CBU)
• Community Trust Bancshares (CTBI)
• Citizens Financial Services (CZFS)
• Bank of the Ozarks (OZK)
• First Source (SRCE)

Chuck addresses a comment criticizing him for “bottom fishing,” noting that value investing is, by definition, buying companies below intrinsic value. This approach reduces risk and increases potential return through a combination of business growth, dividend income, and price-to-earnings (P/E) multiple expansion. He emphasizes that investors should determine their holding period—ideally 3–5 years or longer—and not judge investments on short-term price movements.

Key investing principles covered:

• Orange line (intrinsic value) on FAST Graphs shows what the business is worth based on fundamentals. Buying below this line offers natural leverage.
• Gold line (dividends) is the most predictable metric for income investors; steady increases are a hallmark of Dividend Champions.
• Black line (price) is volatile and unpredictable—price often reverts toward the orange line over time.
• Price-to-Book (P/B) is an additional important valuation measure for banks.

(Click on image to enlarge)

Dividend Champion Regional Bank Cheat Sheet

General Points

• All 6 banks: 25+ consecutive years of dividend increases.
• Yields: Nearly all double the S&P 500’s yield; only one <3%.
• All trading at fair or attractive valuations.
• Best suited for long-term (3–5+ years) income-focused investors.
• Key metrics: P/E relative to growth rate, Price-to-Book (P/B), dividend yield & growth, payout ratio, debt levels.

Chuck reiterates that income investors should focus on the reliability and growth of dividends rather than obsessing over short-term price fluctuations. The market frequently misprices stocks—buying undervalued quality companies positions investors for strong returns, even if the stock remains undervalued for a period. Conversely, overvaluation is a signal to consider selling.

He concludes by stressing due diligence—using FAST Graphs, reviewing company reports, investor relations materials, and multiple research sources—and warns that all investing is long-term ownership when done correctly. Buying at value is essential; otherwise, you’re speculating.

Video Length: 00:21:05

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