This Tennessee bank is forecasted to grow at double-digit rates next year. The current annual dividend yield is 6.28%, paid quarterly.
First Horizon National Corporation (FHN)
From Forbes Dividend Investor
Regional banks tracked by the S&P Regional Banking ETF (KRE) are up nearly 20% in the past five weeks, buoyed over the past week by a sharp rise in long-term interest rates. The yield on the 10-year U.S. Treasury note over the past 10 days has risen from 0.51% to 0.71%. Short-term rates have remained steady. Banks benefit from this steepening of the yield curve because it boosts their net interest margin, since they borrow at short-term rates and lend at long-term rates.
With roots dating back to 1864, Memphis, Tenn.-based First Horizon National Corporation is a financial holding company that offers checking accounts, savings products, mortgage banking, lending, and financing to individuals and businesses. First Horizon generates 82% of revenue from the banking business, and 16% from its fixed income segment, which sells and distributes fixed income securities, loans, and derivatives, and provides portfolio advisory services. FHN trades at substantial discounts to historical valuations, including 53% below its five-year average price-earnings and price-to-book value ratios. Four company directors were buyers of the stock in March and April this year at prices between $8.95 and $9.51 per share.
First Horizon, like most banks, slashed its dividend during the financial crisis, but over the past seven years has tripled the quarterly payout from $0.05 to $0.15 per share. The next ex-dividend date is coming up September 10.
John Dobosz, Forbes Dividend Investor, newsletters.forbes.com, 212-367-3388, August 15, 2020