First National announces 43 percent dividend spike
First National Corporation, the parent company of the Strasburg-based First Bank, announced a 43 percent increase in monthly cash dividends per share Tuesday.
Shareholders will receive a quarterly dividend of 5 cents per share starting March 16. First National Corporation President and CEO Scott Harvard said the increase was, in large part, due to a sustained rise in the company’s earnings.
“We’ve had a pretty strong appreciation in our stock price over the last several years,” Harvard said. “In fact, last year, our stock price appreciated about 40 percent, while our dividend increased, I’ll just say, minimally.”
Bolstering the quarterly dividends by 43 percent was done in an effort to keep those dividends in a “reasonable range,” Harvard said, as well as to reward shareholders.
He also said that the new federal tax law, which reduces the corporate tax rate to 21 percent, was “not the motivator” for the dividend spike.
“That said, it certainly appears that the new tax law will be favorable to us, in terms of earnings and supporting continued growth and dividends,” Harvard said. “Certainly our financial performance should benefit from it, we think.”
Shenandoah Telecommunications Company, more commonly known as Shentel, is another publicly traded company based in Shenandoah County. The company currently pays out a dividend of 26 cents per share annually.
“The county, having a couple of publicly traded companies domiciled slash headquartered in the county, is a real plus,” Harvard said. “I’d like to think that we both add value in terms of economic impact and employment in the county.”