Paying a dividend doesn't have to mean a company has given up
on fast growth.
), for example, is No. 1 in its Internet-Content industry group
with a 99 Composite Rating.
Growth has been fast. In the past two years, earnings leapt
64% and 133%. Revenue stepped up 22% and 26% in the same period.
Over the past 20 years, no two-year period for IACI had better
numbers with the exception of 2002-03.
IAC announced in November that it would begin paying a
At the Nov. 3 earnings call, Chairman and Senior Executive
Barry Diller said, "Anyone who thinks that this is not a growth
company ...simply because we declare a dividend, I think is
Diller added that other companies in similar circumstances
should be buying back shares and repatriating cash to
At the Q2 earnings call Wednesday, Chief Financial Officer
Jeffrey Kip said the company prefers to keep "$500 million to
$750 million of cash readily available."
As of June 30, the company had $945.8 million in cash, cash
equivalents and marketable securities.
Kip added that IAC has "almost no debt." He noted the
quarterly dividend was being doubled from 12 cents a share to 24
cents but said IAC had more to do "to catch up and we'll look to
increase it probably on an annual basis."
The annualized yield is 1.8%.
IAC arguably could be regarded as in its strongest growth
situation over the past 20 years. The company only once has put
together three annual earnings increases in a row -- 2001-03 (and
2001 was compared against a loss).
The Street expects earnings to increase 24% this year and 25%
in 2013. Together with 2010-11, that would make for four
increases in a row.
Earnings, which historically have been inconsistent, are
showing signs of becoming more stable. The five-year EPS
Stability Factor is 96 -- close to a worse possible 99. But the
three-year rating is 45 -- not ideal but certainly an
IAC operates 50 Internet businesses, including Ask.com,
Dictionary.com and Match.com.