Wisconsin Energy Corporation
) has intended to increase its quarterly dividend by 13.3% to 34
cents per share from prior-year payment of 30 cents per share.
This dividend increase is effective from the first quarter of
2013 and will likely be payable on March 1, 2013 to shareholders
of record as of February 14, 2013.
As a result of this revision, Wisconsin Energy is bringing its
annualized dividend to $1.36 per share from the previous payout
of $1.20 per share. Post increase, the annual dividend yield will
Last time, the company had increased its dividend in December
2011. The annual dividend payout upped 15.4% to $1.20 per share
from $1.04 per share earlier. Wisconsin Energy values its owners
and has been trying to increase their income by hiking the
dividend payment each year for the last 15 years.
It is evident from Wisconsin Energy's dividend-distribution
history that the company is always on the lookout for maximizing
its shareholders' wealth and is targeting to reach a dividend
payout ratio of 60% of earnings in 2014.
In third-quarter 2012, the company's cash flow from operating
activities was $992.4 million compared with $827.6 million in the
year-ago quarter. We believe strong operating cash flow position
and a credit facility of approximately $1.2 billion will be
sufficient to meet anticipated cash needs and fund future growth
opportunities over the next couple of years.
The market reacted negatively toward the dividend hike and the
share price declined 0.45% and closed at $37.64 as of December 6,
2012. The dividend in 2011 grew 15.4%, while it spiked 13.3% in
the current year. We believe strong performance of the company
have increased investor expectation while the growth in dividend
rate failed to satisfy the same.
Wisconsin Energy's third-quarter 2012 earnings per share of 67
cents were 21.8% higher than year-ago results and 10 cents higher
than the Zacks Consensus Estimate. The Zacks Consensus Estimate
for quarterly revenue was $32.7 million higher than the actual
figure of $1.04 billion, which was down 1.28% year over year from
$1.05 billion. In addition, the company reaffirmed its full-year
2012 earnings guidance in the range of $2.31 - $2.33 per share.
Recently, another utility provider
OGE Energy Corporation
) increased its quarterly dividend by 6.37% to 41.75 cents per
share from the prior payment of 39.25 cents per share. The
annualized dividend will be $1.67 per share from the earlier
payout of $1.57 per share.
Wisconsin Energy continues to expand and diversify its renewable
as well as less-emission generating assets. Last week, the
company entered into the joint-ownership and air quality control
agreements with the Wolverine Power Cooperative and continues to
progress well at its 50-megawatt biomass-fueled power plant in
northern Wisconsin. These efforts will enable the company to meet
the U.S Environmental Protection Agency regulations.
Milwaukee, Wisconsin-based Wisconsin Energy Corporation engages
in generation and distribution of electricity in southeastern,
east central, and northern Wisconsin, and Upper Peninsula of
Michigan. With a market capitalization of $8.66 billion, the
company has 4,595 full time employees and currently has a
short-term Zacks #2 Rank (Buy rating).
OGE ENERGY CORP (OGE): Free Stock Analysis
WISC ENERGY CP (WEC): Free Stock Analysis
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