Updated 3/11/2025
National Bank Holdings Corporation (NBHC) is a regional bank headquartered in Greenwood Village, Colorado. It serves both commercial and personal banking customers across multiple states, with a focus on sound financial management and risk control. While it’s not the flashiest name in banking, NBHC has built a reputation for steady performance, making it an interesting pick for income-focused investors.
For those seeking reliable dividends, NBHC has a lot to offer—solid yield, a reasonable payout ratio, and a history of consistency. However, with some recent softness in revenue and earnings, it’s worth taking a closer look at whether the dividend remains as secure as it seems.
📊 Key Dividend Metrics
💰 Dividend Yield: 3.02%
📈 Dividend Growth (5-Year Average): 2.58%
📆 Most Recent Dividend Date: March 14, 2025
💵 Payout Ratio: 36.36%
🕒 Ex-Dividend Date: February 28, 2025
📊 Trailing Annual Dividend Yield: 2.97%
🔄 Dividend Consistency: Strong track record
Dividend Overview
At a 3.02% yield, NBHC offers an income stream that’s appealing for dividend investors, sitting just above its five-year average of 2.58%. That suggests the stock might be attractively priced from a yield perspective.
One of the biggest positives here is how well-covered the dividend is. The payout ratio stands at 36.36%, which means the bank is only distributing a fraction of its earnings as dividends. That leaves plenty of room for continued payments even if the bank faces a rough patch.
Another factor worth noting is that NBHC has been a consistent dividend payer. While it may not be the most aggressive grower, it has a reliable track record of rewarding shareholders, and that kind of predictability is invaluable in income investing.
Dividend Growth and Safety
NBHC has been raising its dividend at a slow but steady pace. It’s not a company that’s going to give investors rapid dividend increases, but it also isn’t one to suddenly cut payouts when times get tough.
The low payout ratio is a strong indicator of safety. Since the company is retaining a significant portion of earnings, it has a cushion to absorb potential downturns without jeopardizing its dividend.
That said, one concern is the decline in earnings. Quarterly earnings growth is down 14.9% year-over-year, and revenue is also slipping, down 2% over the same period. If this trend continues, it could eventually limit future dividend growth. However, with an ROE of 9.44%, the bank is still operating at a solid level of profitability, which helps ease concerns.
Chart Analysis
The stock chart for National Bank Holdings Corporation (NBHC) is showing some clear technical signals that investors should pay attention to. The price action over the past year has gone through a full cycle, with a strong rally followed by a distribution phase and now what appears to be a breakdown.
Moving Averages and Trend Direction
The 50-day moving average (blue) has recently crossed below the 200-day moving average (purple), which is often seen as a bearish signal, commonly referred to as a death cross. This crossover suggests that momentum has shifted downward, and the stock could be in a longer-term downtrend.
Before this, the stock had been on a strong run, moving well above both moving averages for most of last year. That rally peaked above $50 before selling pressure took over, pushing the stock below both the 50-day and 200-day moving averages. Now, the price is sitting around $38.43, below both moving averages, reinforcing the downward pressure.
Volume and Selling Pressure
Volume has picked up in recent months, particularly during the decline. This suggests that investors have been offloading shares at a higher rate, possibly locking in profits from the earlier uptrend. There were some attempts at a rebound, as shown by brief spikes in volume, but they haven’t been sustained.
The most recent bars show a mix of red and green, indicating that while some buying is happening, it isn’t strong enough to reverse the overall trend. When volume spikes during sell-offs, it usually means institutions or larger investors are reducing positions, which adds to the pressure on the stock.
Relative Strength Index (RSI) and Oversold Conditions
The RSI, shown at the bottom of the chart, is moving toward oversold levels, currently hovering below 30. A reading below this threshold often suggests that a stock may be due for a short-term bounce, but it doesn’t necessarily mean the broader downtrend is over.
Looking at the past RSI movements, the stock has dipped into oversold conditions before and recovered, but this time the momentum appears weaker. It could mean the stock has further to fall before it finds real support.
Support and Resistance Levels
The next potential support level is around the $35 range, which was a previous consolidation zone before the last rally took off. If the stock doesn’t hold above this level, it could slide further. On the upside, resistance is now around the 50-day moving average, near $40. If the stock does attempt a recovery, that level will be a key test.
With the overall trend shifting downward and technical indicators showing weakness, the stock appears to be in a markdown phase. The recent breakdown below key levels suggests that caution is warranted. However, if RSI levels stay oversold and buyers step in, there could be a short-term bounce before any further decline.
Analyst Ratings
National Bank Holdings Corporation (NBHC) has recently seen a mix of analyst opinions, reflecting both optimism and caution regarding its future performance.
Upgrades:
- Keefe, Bruyette & Woods: On December 4, 2024, this firm maintained its “Market Perform” rating for NBHC but raised the price target from $47 to $52. This adjustment suggests a positive outlook, possibly due to the bank’s solid financial performance or strategic initiatives.
- DA Davidson: On October 24, 2024, DA Davidson reiterated its “Buy” rating and increased the price target from $51 to $53. This indicates confidence in NBHC’s growth prospects and overall financial health.
Downgrades:
- Hovde Group: On November 18, 2024, Hovde Group downgraded NBHC from “Outperform” to “Market Perform,” setting a price target of $55. This change may reflect concerns about market conditions or specific challenges facing the bank.
- Piper Sandler: On July 25, 2024, Piper Sandler lowered its rating from “Overweight” to “Neutral,” adjusting the price target from $42 to $46. This suggests a more cautious stance, possibly due to perceived risks or a reassessment of the bank’s valuation.
Consensus Price Target:
As of the latest available data, the consensus 12-month price target for NBHC stands at approximately $49.00, based on multiple analyst evaluations. This target reflects a balanced view of the bank’s potential, considering both its strengths and the challenges it may face in the current economic environment.
Earnings Report Summary
National Bank Holdings Corporation (NBHC) wrapped up the fourth quarter of 2024 with mixed results, showing both strengths and some areas of weakness. The bank reported net income of $28.2 million, or $0.73 per share, which was down from the previous quarter’s $33.1 million, or $0.86 per share. That dip in earnings was reflected in a slightly lower return on assets at 1.13% and return on equity at 8.59%, both down from earlier in the year.
One big factor that played into this quarter’s results was a strategic move to sell off around $130 million in investment securities. While that decision helped reshape the bank’s balance sheet, it came at a cost, leading to a pre-tax loss of $6.6 million. Without that hit, net income would have been about $33.2 million, keeping it on par with the prior quarter.
On the bright side, the bank’s core lending business stayed solid. Net interest income rose by $2.5 million to $92.0 million, thanks to smart pricing decisions on loans and deposits. While total earning assets dipped slightly, it was largely due to shifting investments around, and loans actually grew by $55.2 million during the quarter.
Looking at the bigger picture, NBHC finished 2024 with full-year net income of $118.8 million, or $3.08 per share. That was a drop from 2023’s $142 million, but it wasn’t entirely unexpected given some of the market pressures. The return on assets for the year was 1.20%, while return on equity came in at 9.41%, both lower than the year before.
Despite the softer earnings, NBHC did manage to grow tangible book value per share by 11% in 2024 and maintained a solid capital position with a Common Equity Tier 1 ratio of 13.2%. That financial cushion gives the bank flexibility as it moves forward, whether for new growth opportunities or to weather any economic bumps ahead.
Overall, while the bank had to navigate some challenges, particularly with its investment portfolio, its core business remained steady. The increase in net interest income and strong capital reserves suggest NBHC is still in a solid position, even as it adjusts to changing market conditions.
Financial Health and Stability
A well-run bank needs strong financial stability, and NBHC generally checks that box. Profit margins are solid, with a 29.72% net margin and a 39.22% operating margin. Those numbers indicate that the bank is managing its expenses well and keeping profitability intact.
Looking at the balance sheet, total cash is sitting at $167.87 million, which provides a nice liquidity buffer. Debt is reasonable at $161.43 million, keeping things in balance without weighing too heavily on the company. The book value per share is $34.29, which means the stock is currently trading at just over book value—a fair level for a stable regional bank.
Overall, while revenue has dipped, NBHC remains financially sound. The bank is in a good position to maintain its dividend, assuming earnings don’t deteriorate further.
Valuation and Stock Performance
NBHC is currently trading at $38.43, with a price-to-earnings ratio of 12.46. That’s within a reasonable range for a bank, neither overly expensive nor alarmingly cheap. Historically, NBHC has traded at slightly lower multiples, so while this isn’t a screaming bargain, it’s not overpriced either.
Compared to its book value per share of $34.29, the stock’s price-to-book ratio of 1.12 suggests a modest premium, which is fairly typical for a bank with stable earnings.
Looking at the 52-week range, the stock has traded between $32.13 and $51.76. Right now, it’s much closer to the low end of that range, which might make it interesting for investors looking for an entry point. However, the 50-day and 200-day moving averages are both above the current price, which indicates that the stock has been in a bit of a downtrend lately. That’s worth keeping an eye on, as it could mean further weakness ahead before it finds solid ground.
Risks and Considerations
While NBHC looks solid from a dividend perspective, there are a few risks worth keeping in mind.
- Declining Revenue – Quarterly revenue is down 2% year-over-year. If that continues, it could eventually impact profitability and slow dividend growth.
- Earnings Pressure – A 14.9% decline in quarterly earnings is a red flag. While it’s not a disaster, continued weakness in earnings could make it harder for the bank to maintain its current financial strength.
- Interest Rate Sensitivity – As a regional bank, NBHC is heavily impacted by interest rates. A shift in the rate environment could put pressure on net interest margins, which might affect earnings.
- Stock Performance Trends – The stock is trading below its moving averages, which suggests some bearish sentiment. If market conditions worsen, there could be more downside ahead.
Final Thoughts
For dividend investors, NBHC offers a stable and well-covered payout, supported by a responsible payout ratio and strong financial health. The current yield is attractive, and while the bank doesn’t have the most aggressive dividend growth, it has a solid history of rewarding shareholders consistently.
The biggest question mark is whether the recent dip in earnings and revenue is a temporary setback or a sign of longer-term challenges. If earnings stabilize, NBHC could be a strong long-term hold for income investors. However, if the weakness continues, future dividend increases may be more limited.
For now, NBHC remains a dependable dividend payer, and its financial foundation is strong. Keeping an eye on the next few earnings reports will be key to determining whether this is a buying opportunity or if further downside risk remains.
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