Raytheon Company
(
RTN
) has increased its dividend by 16%, bringing the annualized
dividend to $2 per share from the previous payout of $1.72 per
share. The 28 cent increase in the annual dividend reflects the
company's focus on capital deployment and its commitment to
shareholders.
The company will now pay a quarterly dividend of 50 cents per
share compared with the prior quarterly dividend of 43 cents per
share. The hiked dividend will be paid on May 3, 2012, to
shareholders of record at the close of business on April 4,
2012.
With this the company has increased the dividend for the eighth
consecutive year. In March 2011, the company had increased its
quarterly dividend by 15% to 43 cents.
Raytheon adopts a balanced capital deployment strategy that
helps in growing its business, including capital expenditures,
acquisitions, and research and development while prudently managing
the balance sheet and returning cash to stockholders through
dividend payments and share repurchases. At the end of 2011, cash
and cash equivalents were $4 billion compared with $3.6 billion in
2010. Going forward, the company believes that all its financing
resources would be sufficient enough to meet its capital
expenditure, investment, debt service and other financing
requirements.
Raytheon is one of the best-positioned companies as it enjoys
strong order bookings and order backlog, an improving balance
sheet, growing cash flow, operational improvements. Revenue and
earnings growth continue to be driven by a strong presence in the
areas of Intelligence, Surveillance and Reconnaissance, air &
missile defense systems, border security, air traffic management,
training and homeland security and cyber security.
These positives are, however, offset by apprehensions over
future growth of the U.S. defense budget, the fate of high-cost
programs, risks related to key project executions and order
cancellations. The company presently retains a short-term Zacks #3
Rank (Hold) that corresponds with our long-term Neutral
recommendation on the stock.
In December last year, Raytheon's peer
The Boeing Company
(
BA
) also increased the quarterly dividend to 44 cents versus its
previous payout of 42 cents per share.
BOEING CO (
BA
): Free Stock Analysis Report
RAYTHEON CO (
RTN
): Free Stock Analysis Report
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