Popular Hikes Dividend: Sustainable Strategy or Short-Term Boost?

Popular, Inc. BPOP has consistently rewarded shareholders through dividend hikes and share repurchases, signaling confidence in its earnings trajectory and liquidity strength.

In its latest move, Popular declared a quarterly cash dividend of 75 cents per share, marking a 7.1% increase from the previous payout. After the announcement of the hike, shares of BPOP rose nearly 2.5% in Friday's trading session.

This follows a 12.9% hike in November 2024 to 70 cents per share. Over the past five years, BPOP has raised its dividend five times, with an annualized growth rate of 12.77%.

Based on its last closing price of $121.90, Popular’s dividend yield stands at 2.3%, backed by a prudent payout ratio of 27%. This suggests the company retains sufficient earnings for reinvestment and future growth initiatives while maintaining consistent returns to shareholders.

Dividend Yield

Beyond dividends, Popular has actively pursued share buybacks. In August 2024, the board authorized a $500 million repurchase program, with $32.8 million remaining as of June 30, 2025. In July 2025, the company further expanded its authorization by another $500 million, reinforcing its capital deployment strategy.

Meanwhile, Popular’s liquidity profile remains robust. As of June 30, 2025, the company had a total debt (comprising short-term borrowings and long-term debt) of $1.4 billion, significantly lower than its liquidity balance of $6.8 billion.

Supported by a solid liquidity position, the company will likely continue with efficient capital deployment activities in the future. Through this, BPOP will keep enhancing shareholder value.

How BPOP Competes With Its Peers in Terms of Dividends

Northern Trust Corporation NTRS has a solid record of rewarding shareholders through both dividends and share repurchases. In July 2025, the company announced a 6.7% dividend hike, raising the quarterly payout to 80 cents per share. On the buyback front, the company’s October 2021 repurchase authorization for 25 million shares remains active, with 5.4 million shares still available as of June 30, 2025. Management expects to maintain repurchase activity at similar levels in the near term. With a robust liquidity, Northern Trust’s capital distribution strategy appears sustainable.

M&T Bank Corporation MTB continues to display capital strength through steady dividends and repurchases. Recently, in August 2025, the bank raised its quarterly dividend by 11.1% to $1.50 per share, payable on Sept. 30, 2025, to shareholders of record as of Sept. 2. This followed a 4% hike in May 2024. On the buyback front, the board authorized a $4 billion repurchase plan in January 2025, with $2.3 billion still available as of June 30, 2025. Backed by the strong liquidity position, MTB’s strong liquidity supports the sustainability of its capital distribution strategy.

BPOP’s Price Performance and Zack Rank

Shares of BPOP have gained 22.6% in the past year compared with the industry’s growth of 7.6%.

One-Year Price Performance

Popular currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research