Yesterday, the media and film producing company,
) declared that its board of directors has decided to raise the
quarterly dividend by 9%. The new quarterly dividend will be 30
cents per share compared with the existing rate of 27.5 cents per
share. The new dividend is payable on Jul 1, 2013 to shareholders
of record as of Jun 14. This was the company's third increase in
dividend rate within three years.
Management cited Viacom's solid balance sheet and strong cash
flow as the primary reasons behind the dividend hike. The company
is also pursuing a $10 billion share buy-back program. Viacom
currently has a Zacks Rank #3 (Hold).
We believe that Viacom is well positioned for long-term growth
as it continues to benefit from its predominant cable
networks-based business model, hit movie releases, and
monetization of contents from multiple distribution platforms.
Viacom significantly improved its viewership ratings for its
immensely popular Nickelodeon and MTV channels. In the reported
quarter, the viewership rating was up 7% year over year compared
with a stiff fall of 30% over the last one year.
Viacom is offering video-on-demand websites to
)'s U-Verse customers,
Time Warner Cable Inc.
) subscribers to watch their content online, thereby driving
their new TVEverywhere service for the years to come. Viacom
highly benefits from its agreement to distribute digital content
to online video streaming companies. Management is hopeful that
it will be able to expand its digital content distribution deals,
both in the U.S. and internationally in the near future.
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VIACOM INC-B (VIAB): Free Stock Analysis
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