John Marshall Bancorp, Inc. (NASDAQ:JMSB) is about to trade ex-dividend in the next three days. The ex-dividend date is one business day before the record date, which is the cut-off date for shareholders to be present on the company's books to be eligible for a dividend payment. The ex-dividend date is an important date to be aware of as any purchase of the stock made on or after this date might mean a late settlement that doesn't show on the record date. Thus, you can purchase John Marshall Bancorp's shares before the 28th of June in order to receive the dividend, which the company will pay on the 8th of July.

The company's upcoming dividend is US$0.25 a share, following on from the last 12 months, when the company distributed a total of US$0.22 per share to shareholders. Calculating the last year's worth of payments shows that John Marshall Bancorp has a trailing yield of 1.5% on the current share price of US$16.45. We love seeing companies pay a dividend, but it's also important to be sure that laying the golden eggs isn't going to kill our golden goose! So we need to check whether the dividend payments are covered, and if earnings are growing.

Check out our latest analysis for John Marshall Bancorp

If a company pays out more in dividends than it earned, then the dividend might become unsustainable - hardly an ideal situation. Last year John Marshall Bancorp paid out 102% of its profits as dividends to shareholders, suggesting the dividend is not well covered by earnings.

When a company pays out a dividend that is not well covered by profits, the dividend is generally seen as more vulnerable to being cut.

Click here to see how much of its profit John Marshall Bancorp paid out over the last 12 months.

Have Earnings And Dividends Been Growing?

Businesses with shrinking earnings are tricky from a dividend perspective. If business enters a downturn and the dividend is cut, the company could see its value fall precipitously. With that in mind, we're discomforted by John Marshall Bancorp's 26% per annum decline in earnings in the past five years. Such a sharp decline casts doubt on the future sustainability of the dividend.

Unfortunately John Marshall Bancorp has only been paying a dividend for a year or so, so there's not much of a history to draw insight from.

Final Takeaway

Is John Marshall Bancorp an attractive dividend stock, or better left on the shelf? Not only are earnings per share shrinking, but John Marshall Bancorp is paying out a disconcertingly high percentage of its profit as dividends. Generally we think dividend investors should avoid businesses in this situation, as high payout ratios and declining earnings can lead to the dividend being cut. These characteristics don't generally lead to outstanding dividend performance, and investors may not be happy with the results of owning this stock for its dividend.