Oilfield service company
Core Laboratories N.V.
) increased its quarterly common stock dividend by 14.2% to 32
cents per share ($1.28 per share annualized). The new dividend
will be paid on February 22, 2013 to shareholders of record as of
CORE LABS NV (CLB): Free Stock Analysis
PETROBRAS-ADR C (PBR): Free Stock Analysis
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The strength of Core Laboratories' business model reflects the
company's commitment toward returning value to shareholders with
its strong cash generation capabilities. Prior to this revision,
the company had increased its quarterly dividend by 3 cents per
share in January 2012.
Core Laboratories has a strong capital deployment policy through
regular share repurchase and payment of dividends. During the
third quarter of 2012, the company repurchased 283,513 shares for
an aggregate cost of $33,191,000 at an average price of $117.07
per share. Moreover, it has paid common stock dividends amounting
to $13,252,000 to shareholders during the same period.
As on September 30, 2012, Core Laboratories had cash and cash
equivalents of $24.7 million. The company generated free cash
flow of $42.0 million.
We believe that the increase in dividend and share repurchase
programs will boost investor confidence in the stock, thereby
driving share value.
Amsterdam, Netherlands-based Core Laboratories N.V provides
reservoir management and production enhancement services to the
oil and gas industry on a global basis. The company operates in
over 50 countries and divides its operations in three principal
business lines: Reservoir Description, Product Enhancement, and
Core Labs has operations in over 50 countries, with approximately
50% of its total revenue coming from international markets. In
particular, the company has collaborated extensively with
Brazil's state-run energy giant
Petroleo Brasileiro S.A.
) to undertake a number of reservoir analysis ventures in onshore
and offshore plays of the country.
However, with Core Labs' dependence on foreign makets, it is also
exposed to risks associated with doing business abroad.
Such risks include embargoes and/or expropriation of assets,
exchange rate risks, terrorism and political/civil sentiment in
critical countries like Iran, Iraq, Nigeria and Venezuela.
The company currently retains a Zacks Rank #4 (Sell), implying
that it is expected to underperform the broader U.S. equity
market over the next one to three months.