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Allstate Rewards Investors with Increase in Dividend Payout

The Allstate CorporationALL will be sharing more profit with its investors through the recent 10% hike in its quarterly cash dividend. The company will now pay a quarterly dividend of 33 cents per share, up from 30 cents paid on Jan 4, 2016.

Shareholders on record as of Feb 29, 2016 will have the meatier dividend in their pockets on Apr 1, 2016. The current dividend yield of 2.07% is slightly lower than the industry average 3%. Nonetheless, the five-year average dividend yield of the company is 1.98%, which is comparatively better than the industry average of 1.92%.

The dividend hike was primarily backed by the Property and Casualty (P&C) insurer's earnings capacity which, in turn, was driven by superior performance by its homeowners business and sturdy capital position. A robust capital position makes it possible for the insurer to continually increase its dividend payouts and undertake growth initiatives as well as maintain strategic flexibility. Allstate's efficient capital management is displayed by its solid cash returns to its shareholders.

Allstate has a proven track record of dividend payouts which ultimately reflects its stable earnings capacity and substantial capital position. In Feb 2015, Allstate raised its quarterly dividend by 7.1% to 30 cents per share, from 28 cents in the previous quarter. In 2015, the company paid a total of $483 million in common shareholder dividends.

This P&C insurer has also delivered positive surprises in three of the last four quarters with an average beat of 1.88%.

Zacks Rank and Stocks to Consider

Currently Allstate carries a Zacks Rank #3 (Hold). Some better-ranked P&C insurers are Chubb Limited CB , Fidelity Financial National Ventures FNFV and PartnerRe Ltd. PRE . Each of these stocks sports a Zacks Rank #1 (Strong Buy).

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CHUBB LTD (CB): Free Stock Analysis Report

PARTNERRE LTD (PRE): Free Stock Analysis Report

ALLSTATE CORP (ALL): Free Stock Analysis Report

FNFV GROUP (FNFV): 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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