North American energy firm, Williams Companies Inc. (WMB) declared fourth-quarter 2014 cash dividend of 57 cents per share. The new dividend reflects a sequential hike of almost 2% and a year-over-year increase of 50%. Williams added that the dividend is payable on Dec 29, 2014, to shareholders of record as of Dec 12.
If the revised dividend is maintained for a year, the company’s annualized dividend payout would be $2.28 per share. Based on the closing price of $54.54 on Nov 18, the increased dividend indicates a yield of over 4%.
Williams’ dividend for 2014 stands at $1.96 per share, reflecting a hike of 36% from $1.44 paid out in 2013.
Moreover, Williams retained its previous dividend projection of $2.46 for 2015. For 2015 through 2017, the company plans a 15% dividend hike, as declared previously.
Separately, Williams declared that in order to meet the growing demand for clean burning natural gas in the southeastern region of the U.S., Transco – an affiliate of Williams Partners LP (WPZ) − seeks approval from the Federal Energy Regulatory Commission (FERC) for expanding its pipeline system. Williams is the general partner and has a controlling interest in Williams Partners.
Williams has designed Hillabee Expansion Project – likely to commence May 2017 – for capacity expansion of the Transco pipeline system in Alabama. The improved capacity – which will comprise manufacture of extra pipe segments covering 43 miles along with modification of existing pipelines − will transport increased natural gas from Choctaw County to Tallapoosa County in Alabama.
Hillabee Expansion Project is expected to operate in three phases which will likely add roughly 1,131,000 dekatherms per day to the transportation capacity of Transco by May 2021. Williams added that the expanded capacity is enough to meet the annual natural gas demand – for electricity generation − of more than 4 million American households.
Williams revealed that roughly $4.5 billion capital will likely be allocated to the Transco growth project − the nation’s highest-volume natural gas transmission system – and its sub-part, Hillabee Expansion.
Tulsa, OK-based Williams currently carries a Zacks Rank #3 (Hold), implying that it will perform in line with the broader U.S. equity market over the next one to three months.
Meanwhile, one can look at better-ranked players in the energy sector like SandRidge Mississippian Trust I (SDT) and Sandridge Mississippian Trust II (SDR). Both stocks sport a Zacks Rank #1 (Strong Buy).
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