Ushering in good news for its shareholders, retail real estate
investment trust (REIT) -
Taubman Centers Inc.
) - announced an 8% increase in its quarterly dividend rate. The
company will now pay a dividend of 54 cents per share on its
common stock, up from 50 cents paid in the prior quarter. The
increased dividend will be paid on Mar 31, 2014 to shareholders
of record on Mar 17.
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Taubman has established an impressive track record of
conservative capital management and cash returns to shareholders
in the form of a steady dividend. It has never slashed its common
dividend since it went public in 1992 and has in fact hiked its
dividend 17 times since then. The new dividend rate results in an
annualized yield of 3.1% based on the stock's closing price of
$69.82 on Mar 6.
With its solid portfolio of best-in-class retail malls, Taubman
is well poised to improve its results in the quarters ahead.
Strategic constructions and redevelopments at high-end markets
are expected to be accretive to its top line going forward. The
company exited the year 2013 with cash and cash equivalents of
around $41.0 million, up from $32.1 million at year-end 2012.
Moreover, last month, Taubman came up with an impressive
fourth-quarter earnings results, primarily driven by increase in
rents, lowered interest expense, and the late 2012 purchase of an
additional stake in International Plaza (Tampa, Fla.) and
Waterside Shops (Naples, Fla.). As such, the company is well
poised to maintain its growth curves and simultaneously benefit
the shareholders with steadily rising dividends.
In addition to Taubman, a number of other REITs have raised their
dividends in the recent months. Among them,
) announced nearly an 18% increase in its quarterly dividend rate
to 33 cents per share from 28 cents, while
Simon Property Group Inc.
) increased its quarterly dividend by over 4% to $1.25 per share
from $1.20 paid in the prior quarter. Moreover,
Avalonbay Communities Inc.
) enhanced its quarterly dividend rate by over 8% to $1.16 per
share from $1.07 per share paid earlier.
Solid dividend payouts are arguably the biggest attraction for
REIT investors as the U.S. law requires these companies to
distribute 90% of their annual taxable income in the form of
dividends to shareholders.
Taubman currently carries a Zacks Rank #3 (Hold).