The tobacco manufacturer,
Altria Group Inc.
) recently hiked its dividend by 7.3% to 44 cents per share. The
dividend increase from 41 cents per share is in tune with Altria's
dividend payout ratio target of around 80% of its adjusted earnings
LORILLARD CO (LO): Free Stock Analysis Report
ALTRIA GROUP (MO): Free Stock Analysis Report
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The quarterly dividend will be paid on October 10, 2012, to
shareholders of record as on September 14, 2012. The new annualized
dividend rate is $1.76 per common share, up 7.31% compared with
$1.64 per common share.
The company has already increased its dividend 46 times in the last
43 years. The last dividend hike was in August 2011, when the
company had hiked its quarterly dividend by 7.9% to 41 cents per
share from 38 cents per share.
Besides hiking dividend, the company also repurchases shares to
enhance shareholders value. It spent $66 million in the second
quarter to buy back 2 million at an average cost of $32.37 per
The company recently delivered second quarter 2012 earnings of 59
cents, which beat the Zacks Consensus Estimate by 2 cents as
well as the prior-year quarter results by 9.3%.
Following the better-than-expected second quarter results, the
company raised its 2012 earnings guidance from a range of $2.17 to
$2.23 to a range of $2.19 to $2.23, representing a growth rate of
7% to 9% over $2.05 per share in 2011. The Zacks Consensus Estimate
is pegged at $2.21 per share for full year 2012.
The company expects adjusted diluted earnings per share to be up
modestly in the second half of 2012.
Following the announcement, the share prices of the company
increased upwards. It is likely that continuous efforts on the part
of the company to boost shareholders' value, reinstated investor
confidence and hence helped the share price move upwards. The share
price of Altria ascended 1.9% to close at $34.08 as on Friday.
Headquartered in Richmond, Virginia, Altria engages in the
manufacture and sale of cigarettes, smokeless products, and wine in
the United States and internationally. It competes with
Reynolds American Inc.
Currently, the company holds a Zacks #3 Rank (short term Hold
rating) with a long-term Neutral recommendation.