Contract drilling services provider
Helmerich & Payne Inc.
) raised its quarterly cash dividend to 50 cents per share ($2.00
per share annualized), representing an increase of a whopping
233% over the previous payout. The new dividend is payable on Aug
30, to shareholders of record as of Aug 15, 2013.
Helmerich & Payne, which reported impressive fiscal second
quarter results in Apr, has bolstered its long-term earnings and
cash flow visibility on the back of the company's long term
contracts and premium rates.
We believe that the dividend hike not only highlights Helmerich
& Payne's commitment to create value for shareholders but
also underlines the rig supplier's healthy financial condition
and confidence in its business going forward.
The increased payout will not only provide investors with a juicy
3.2% yield but also leave the company with enough flexibility to
keep on pursuing growth opportunities.
Incorporated in 1940, Helmerich & Payne is a leading drilling
contractor with activities in the U.S. and overseas. Supported by
a superior and diversified drilling fleet, together with a
healthy financial profile, we expect Helmerich & Payne to
sustain its profitability over the foreseeable future.
We believe its technologically-advanced FlexRigs will continue
to benefit from the shift to complex onshore plays that require
highly intensive solutions. However, slow activity levels and the
challenging U.S. land rig environment remain areas of concern.
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This accounts for Helmerich & Payne's current Zacks Rank #3
(Hold), implying that it is expected to perform in line with the
broader U.S. equity market over the next one to three months.
Meanwhile, one can look at
Newpark Resources Inc.
Exterran Partners L.P.
Dawson Geophysical Co.
) as good buying opportunities. These energy equipment service
providers - sporting a Zacks Rank #1 (Strong Buy) - have solid
secular growth stories with potential to rise significantly from