In tune with its efforts to boost stockholders' return, real
estate investment trust (REIT)
Host Hotels & Resorts, Inc.
) hiked its quarterly cash dividend by 8.3% sequentially to 13
cents per share. With this, the company's total dividend for 2013
comes in at 46 cents, up 53% year over year.
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The dividend will be paid on Jan 15, 2014 to shareholders of
record as of Dec 31, 2013. Host Hotels' current payout marks its
12th consecutive quarterly dividend increase.
Host Hotels' history of increasing quarterly dividend reflects
its long-term strategy to provide attractive risk-adjusted
returns to shareholders. So it is an attractive pick for
investors looking for high dividend yields. However, the company
slashed its dividend twice following the sub-prime mortgage
crisis in 2007 that affected many REITs.
Notably, Host Hotels' current annual dividend yield is fairly
decent at approximately 2.5% based on its closing price of $18.41
as on Dec 17.
Given its strong and flexible balance sheet, Host Hotels has
adequate room to increase its dividend rate, going forward.
Moreover, as of Sep 30, 2013, the company had cash and cash
equivalents worth $354 million. We believe that it has adequate
cash for continuing with strategic investments, going forward.
Apart from Host Hotels, many other REITs have increased their
dividends in the recent times.
Parkway Properties Inc.
) hiked its quarterly cash dividend by 25% sequentially to 18.75
cents per share and
W. P. Carey Inc.
) raised its quarterly cash dividend by 1.2% sequentially to 87
cents per share. W. P. Carey also declared a fourth-quarter
special dividend of 11 cents per share.
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 to shareholders.
Host Hotels currently carries a Zacks Rank #3 (Hold). However,
Getty Realty Corp
) is a Zacks Rank #1 (Strong Buy) REIT stock.