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Agilent (A) to Reward Shareholders with 15% Dividend Hike

Agilent Technologies Inc.A , a broad-based OEM of test and measurement equipment recently raised the quarterly dividend to 11.5 cents per share from 10 cents, representing a 15% hike.

The new dividend, yielding 1.2% annually, will be paid on Jan 27, 2016 to shareholders of record as on Jan 5.

The strength of Agilent's business model is reflected in its strong cash generation capabilities and commitment to return value to shareholders. We believe that the consistent increase in dividends will inspire investors' loyalty.

Agilent's strong balance sheet and cash flows provide the financial flexibility required for dividend hikes, share repurchases and strategic acquisitions. During the fourth quarter of fiscal 2015, the company returned $400 million through dividends and buybacks and generated $491 million in operating cash flow. The cash and short-term investments balance was $2.2 billion as against $2.7 billion in the prior quarter.

We are encouraged by the company's strong cash position and ability to service its long-term debts.

Agilent delivered decent fourth-quarter results with the bottom line surpassing the Zacks Consensus Estimate and the top line matching the same. The company's decision to divest/ wind up underperforming businesses has enhanced focus on the new Agilent, while enabling management to expand the solid recurring revenue base and diversify geographic and industrial operations to achieve growth. Also, the company's focus on aligning investment toward more attractive growth avenues and innovative product launches is a positive.

However, uncertain macro conditions, particularly in the U.S. and Europe, and softer-than-expected earnings guidance raised investors' concern regarding Agilent's near-term performance.

Nevertheless, the company seems prepared to counter the impact of foreign currency headwinds on revenues and profits.

Currently, Agilent has a Zacks Rank #3 (Hold). Some well-ranked stocks in the same industry are NVIDIA Corp. NVDA , Texas Instruments Inc. TXN and Stamps.com Inc. STMP . All the stocks sport a Zacks Rank #1 (Strong Buy).

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AGILENT TECH (A): Free Stock Analysis Report

TEXAS INSTRS (TXN): Free Stock Analysis Report

NVIDIA CORP (NVDA): Free Stock Analysis Report

STAMPS.COM INC (STMP): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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