The Walt Disney Company
's (
DIS
) strong results poise it well to enhance shareholders value
through dividends and share repurchases. In a similar move, the
company recently increased its quarterly dividend by 25% bringing
the annualized payout to 75 cents per share with a dividend yield
of 1.52%.
The quarterly dividend, after the hike, will come to 18.75
cents a share, up from the prior payment of 15 cents. The
enhanced quarterly dividend will be payable on December 28, 2012,
to shareholders of record as on December 10, 2012.
Disney's dividend increase reflects its focus on capital
deployment. Besides paying a dividend, the company's capital
deployment strategy includes stock buybacks. During the recently
concluded fourth quarter of fiscal 2012, it bought back 19.1
million shares for approximately $973 million. In fiscal 2012,
Disney repurchased 72 million shares for approximately $3
billion.
Moreover, Disney generated free cash flow of $602 million and
ended the fourth quarter with cash and cash equivalents of $3,387
million, net borrowings of $10,924 million and shareholders'
equity of $39,759 million, excluding non-controlling interest of
$2,199 million.
Further, Disney continues to invest in its core businesses and
remains well positioned to drive revenue growth in the coming
years through its strategic initiatives.
Walt Disney is one of the world's leading diversified
entertainment companies. Alongside, the company commands a
formidable portfolio of globally recognized brands, primarily its
namesake brand Walt Disney, followed by ABC, ESPN and Marvel
Entertainment. These renowned brands offer a strong competitive
edge to the company and bolster its well-established position in
the market against major players like
News Corporation
(
NWSA
) and
Time Warner Inc
. (
TWX
).
We maintain a long-term 'Neutral' recommendation on the stock.
Additionally, the shares of Disney currently retain a Zacks #3
Rank, which translates into a short-term 'Hold' rating.
DISNEY WALT (DIS): Free Stock Analysis Report
NEWS CORP INC-A (NWSA): Free Stock Analysis
Report
TIME WARNER INC (TWX): Free Stock Analysis
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