Waste Management (WM) recently announced a 2.7% year-over-year hike in its quarterly dividend payout to 38.5 cents per share. This brings the annualized payout to $1.54 per share. The increased dividend is payable on Mar 20, 2015 to shareholders of record as of Mar 9.
A steady dividend payment policy is part of Waste Management’s long-term strategy of providing attractive risk-adjusted returns to its stockholders. The company’s investment strategy takes a holistic view of the rapidly evolving market and deploys a dynamic capital allocation approach to execute its growth strategy. In addition, decent dividend increases at periodic intervals have been one of the company’s most attractive features.
Waste Management had earlier raised the quarterly dividend payout from 36.5 cents to 37.5 cents per share or from $1.46 to $1.50 in Mar 2014 on an annualized basis and from 35.5 cents to 36.5 cents per share or from $1.42 to $1.46 annually in Mar 2013. Prior to that, Waste Management raised its quarterly dividend in Mar 2012 from 34 cents to 35.5 cents and in Mar 2011 from 31.5 cents to 34 cents per share.
The current dividend increase comes close on the heels of strong fourth-quarter 2014 results, wherein Waste Management reported healthy year-over-year improvement in earnings. The company reported net income of $590 million or $1.28 per share in the fourth quarter of 2014, reviving remarkably from a net loss of $605 million or loss of $1.29 per share in the year-ago period. The increase in earnings was driven by strong pricing and cost control initiatives.
Excluding one-time items, adjusted earnings per share (EPS) stood at 67 cents in the reported quarter versus EPS of 56 cents in the year-ago period. The adjusted earnings exceeded the Zacks Consensus Estimate of 61 cents.
Moving forward, Waste Management intends to increase its dividend by 4 cents to $1.54 per share on an annual basis for approximately $700 million. Also, the company has authorized a share repurchase program of up to $1 billion.
Headquartered in Houston, TX, Waste Management is the largest provider of comprehensive waste management services in North America. The company provides collection, transfer, recycling and resource recovery, as well as disposal services to residential, commercial, industrial and municipal customers. It is also a leading developer, operator and owner of waste-to-energy and landfill gas-to-energy facilities in the U.S.
Waste Management currently has a Zacks Rank #3 (Hold). Other stocks that look promising and are worth a look include Huron Consulting Group Inc. (HURN), CRA International Inc. (CRAI) and Corporate Executive Board Co. (CEB), each carrying a Zacks Rank #2 (Buy).
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
Be the first to comment