Ushering in good news for its shareholders, Host Hotels & Resorts Inc. (HST) announced a special cash dividend of 6 cents per share in addition to its regular quarterly cash dividend of 20 cents per share.
This special dividend, combined with the regular dividend of all the four quarters of 2014, reflects a rise of 63% from the aggregate common dividend of 2013. Host Hotels’ stockholders of record on Dec 31, 2014 would receive a total dividend worth 26 cents per share on Jan 15 next year.
Only recently, Taubman Centers Inc. (TCO) announced a special cash dividend of $4.75 per share, which was an outcome of the sale of seven malls to Starwood Capital Group in Oct 2014.
Usually, REITs pay a special dividend to equate its annual distribution to the taxable income. However, Host Hotels has a solid track record of increasing shareholders’ wealth and has accordingly hiked its dividend payout several times in the past quarters. In fact, the company’s third-quarter dividend of 20 cents denotes a 33% increase over the prior-quarter rate of 15 cents.
Host Hotels also came up with encouraging results in third-quarter 2014. It reported an earnings surprise of 6.25%, benefiting from a notable rise in comparable revenue per available room (RevPAR) and occupancy.
The company’s solid portfolio of upscale hotels across vibrant markets has the necessary potential for significant capital appreciation. Therefore, we believe Host Hotels is poised to grow and reward investors in the quarters ahead, backed by its solid operating portfolio performance as well as improving market fundamentals, especially in the West Coast market with strong lodging demand and lower supply.
As a matter of fact, solid dividend payouts are arguably the biggest attraction for REIT investors as the U.S. law requires these companies to distribute 90% of their annual taxable income in the form of dividends to shareholders.
In recent times, SL Green Realty Corp. (SLG) announced a 20% sequential increase in its fourth-quarter 2014 dividend to 60 cents from the previous 50 cents, while General Growth Properties Inc. (GGP) unveiled a fourth-quarter common stock dividend of 17 cents per share, representing an increase of 6.3% year over year.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
To read this article on Zacks.com click here.
Get all Zacks Research Reports and be alerted to fast-breaking buy and sell opportunities every trading day.
Be the first to comment