In conjunction with record quarterly results, insurance
giantAflac (
AFL
) recently extended its long streak of dividend increases.
The company bumped up its quarterly payout by 6.1% to 35 cents
a share. The dividend will be paid Dec. 3 to shareholders of
record Nov. 14.
Aflac is a member of the S&P Dividends Aristocrats index,
which tracks big caps that have raised their payouts each year
for at least 25 straight years.
The latest increase marks Aflac's 30th dividend annual hike.
Aflac has a policy to grow shareholder dividends in line with
operating earnings growth, before impact of the Japanese yen. The
company gets about 75% of sales from the land of the rising
sun.
Aflac pays $1.40 a share on an annualized basis. This gives
its stock a yield of 2.8%, which is higher than that of the
S&P 500's 2.6%. The company also has the highest yield in the
Insurance-Accident & Health group. Aflac's payout has more
than doubled since 2006.
While many companies have reported disappointing quarterly
earnings and/or sales, Aflac was not one of them. Last week, the
insurer reported Q3 earnings of $2.16 a share. But adjusted
earnings, which excludes net realized gains-losses from
investments, came in at $1.77 a share, up 7% from a year ago.
Helped by strong sales of a hybrid whole-life product in
Japan, revenue grew 14% to about $6.85 billion. That topped
expectations of $6.51 billion and marked the fifth straight
quarter of double-digit growth.
The company also raised its full-year profit outlook to $6.58
to $6.63 a share, representing growth of 4.6% to 5.4%.
Aflac is a steady grower. It has five-year earnings growth of
17% and a five-year Earnings Stability Factor of 3. The firm's
five-year sales growth is 10%.
The stock cleared a 50.34 buy point from a cup-with-handle
base Oct. 17 intraday. Volume grew only 31% above average that
day. Turnover should typically be at least 40% above average on a
breakout.
Still, Aflac has not gotten any traction. It's now about 2%
below that buy point. But the stock is only 1% off its 52-week
high.