Soon after its formation, the board of directors of Orbital ATK, Inc. OA announced its plan to pursue several investor-friendly initiatives. The company will distribute a quarterly cash dividend of 26 cents on Jun 25, 2015 to stockholders of record as of Jun 8. With this announcement, the annualized dividend rate stands at $1.04.
The company’s board also declared the authorization of a share repurchase program worth up to $75 million of its common stock. Depending on approvals, market conditions and other issues, Orbital ATK will exercise this program over the remainder of 2015 and may be able to purchase shares in the open market.
The aforesaid programs are expected to act as catalysts for attracting potential investors, besides boosting shareholder value.
In 2014, Orbital ATK’s revenues and net income came in at $4.44 billion and around $0.25 billion, respectively. The company plans to maintain a compound annual growth rate of 4%–5% for revenue and cumulative free cash flow of around $1 billion between 2015 and 2017.
Orbital ATK is placed quite well with its stable contract backlog, steady flow of orders and merger synergies, which will fulfill its fund requirement for paying dividends and repurchasing shares of its common stock.
Dulles, VA-based Orbital ATK, an aerospace and defense company, was formed on Feb 9, 2015, though the merger of Orbital Sciences Corporation and the Aerospace and Defense groups of Alliant Techsystems Inc.
The company operates through three segments, namely, Flight Systems Group, Defense Systems Group and Space Systems Group, in 20 U.S. states and several international locations.
Orbital ATK currently holds a Zacks Rank #5 (Strong Sell). Some better-ranked stocks in the industry include GenCorp Inc. GY, Rockwell Collins Inc. COL and Spirit AeroSystems Holdings, Inc. SPR. All three carry 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