Viacom Hikes Dividend - Analyst Blog
May 26 2011 - 8:15AM
Zacks
The board of directors of
Viacom Inc. (VIA.B) recently
increased the company’s quarterly cash dividend on its class A and
class B common stock by 67% to 25 cents per share.The company will
pay the dividend on July 1, 2011 to shareholders of record as of
June 15, 2011.
We believe that the rise in
dividend was mainly driven by the company’s blockbuster financial
results and huge cash availability. The company intends to enhance
share holders’ value by means of raising dividends or increasing
share repurchases. The company has already bought 11.4 million
common shares worth $500 million in the second quarter of 2011.
Moreover, Viacom possesses a strong
balance sheet with $1,555 million of cash and cash equivalents. The
company plans to utilize the excess cash available for share
buybacks and dividend payouts.
Viacom started paying dividends
from June last year and has already paid four dividends. The
current dividend yield of the company is 1.20%.
CBS
Corp.(CBS), Time Warner
Inc.(TWX) and News Corp.
(NWSA) are the nearest rivals of Viacom. Recently,
these competitors paid quarterly dividends of 5 cents, 23.5 cents
and 7.5 cents with dividend yields of 1.52%, 2.63% and 0.88%,
respectively. Currently, shares of Viacom are trading at $59.71,
which is much higher than its peers. Furthermore, it also
indicates that the company’s policy of paying dividends and
repurchasing shares have boosted its share price over the past one
year.
Recently, the company reported
blockbuster financial results for the second quarter of 2011, where
both the top line and bottom line exceeded the Zacks Consensus
Estimate by a significant margin.
We, thus, maintain our long-term
Neutral recommendation for Viacom. Currently, Viacom has a Zacks#2
Rank, implying a short-term Buy rating on the stock.
CBS CORP (CBS): Free Stock Analysis Report
NEWS CORP INC-A (NWSA): Free Stock Analysis Report
TIME WARNER INC (TWX): Free Stock Analysis Report
VIACOM INC-B (VIA.B): Free Stock Analysis Report
Zacks Investment Research
CBS (NYSE:CBS)
Historical Stock Chart
From Jun 2024 to Jul 2024
CBS (NYSE:CBS)
Historical Stock Chart
From Jul 2023 to Jul 2024