Stock prices come in all sizes. For investors who may not have a great deal of capital to deploy in high-priced ones, but are still looking for generous dividend yields, Banco Bradesco S.A. (BBD) is one that can be bought for under $5 per share, highlights Bob Ciura, editor of Top 10 Dividend Elite.
A few stocks trade well above $1,000 per share, such as Booking Holdings (BKNG) and AutoZone (AZO). Meanwhile, Warren Buffett’s Berkshire Hathaway (BRK.A) currently trades above $400,000 per share.
But most companies don’t have such high share prices. When a share price gets very high, many companies will split their stock to lower the share price. In the eyes of some, this makes the stock more approachable for investors who may not have thousands of dollars to invest at a time.
In the same vein, investors can screen for stocks with low share prices – including those below $5. While bank stocks are currently out of favor due to deposit stability concerns in the U.S. and Europe, one South American name that pays a generous yield is BBD.
Banco Bradesco offers various banking products and financial services to individuals, corporations, and businesses in Brazil and internationally. The company’s two main segments are banking and insurance, including checking and savings accounts, demand deposits, time deposits, as well as accident and property insurance products and investment products.
The company generates around $20 billion in annual revenues and is headquartered in Osasco, Brazil.
On Feb. 10, Banco Bradesco reported its Q4 and full-year results for the period ending Dec. 31, 2022.
The banking segment’s net interest income came in at $3.20 billion for the quarter, representing a 1.7% decline year-over-year. Income from insurance grew by 21.9% to $824.5 million. The significant increase in insurance income was favored by the expansion of revenue in all lines of business and by the increase in financial income.
Recurring net income came in at $0.31 billion, 75.9% lower compared to last year. The main reasons for this result were the performance of the market Net Interest Income, which was negatively affected by the current level of the Selic (Special System for Settlement and Custody) benchmark interest rate in Brazil, the increase in expenses caused by delinquencies, and the reinforcement of the complementary ALL (additional coverage provision).
EPS for the year came in at $0.37, down from $0.39 in fiscal 2021. We are forecasting FY2023 EPS of $0.38, assuming higher net interest income due to rising interest rates.
Recommended Action: Consider BBD as a low-priced dividend stock.