Alexandria Real Estate Equities, Inc.
), a real estate investment trust (REIT), has recently increased
its quarterly dividend from 51 cents to 53 cents per share.
This translates into a 4.0% increase from the prior dividend
payout. The dividend is payable on October 15, 2012 to shareholders
of record on September 28.
As of June 30, 2012, the company's funds from operations payout
ratio (quarterly common stock dividend divided by quarterly funds
from operations), was 49%. Alexandria Real Estate increased its
quarterly dividend per share by 8 cents or approximately 18% over
the past 15 months.
At the end of second quarter 2012, Alexandria Real Estate had cash
and cash equivalents of $80.9 million. The company expects to
distribute its excess cash to the shareholders through increased
dividend. We believe that the company has enough cash to provide
optimum shareholder value.
A steady dividend payout facilitates the long-term strategy of
Alexandria Real Estate to provide risk-adjusted returns to its
shareholders. Solid dividend payouts are arguably the best
enticement for REIT investors as U.S. laws require REITs to
distribute 90% of its annual taxable income in the form of
dividends to shareholders.
Pasadena, California-based Alexandria Real Estate is a leading life
science real estate company, focused principally on science-driven
cluster development through the ownership, operation, management
and selective acquisition, development and redevelopment of
properties containing life science laboratory space.
Alexandria Real Estate currently retains a Zacks #3 Rank, which
translates into a short-term Hold rating. We also have a long-term
Neutral recommendation on the stock. One of its competitors,
Liberty Property Trust
) also holds a Zacks #3 Rank.
Note: Funds from operations, a widely used metric to gauge the
performance of REITs, is obtained after adding depreciation and
amortization and other non-cash expenses to net income.
ALEXANDRIA REAL (ARE): Free Stock Analysis
LIBERTY PPTY TR (LRY): Free Stock Analysis
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