Edison International Declares 4.1% Quarterly Dividend Hike
Zacks Investment Research | Dec 12, 2019 09:12PM ET
Edison International’s (NYSE:EIX) board of directors recently announced its decision to increase quarterly dividend rate by 4.1%. The revised dividend of 63.75 cents per share will be distributed on Jan 31, 2020, to its shareholders of record at the close of business on Dec 31, 2019.
The latest hike marks an increase of 2.50 cents from the prior payout of 61.25 cents per share. The new annualized dividend amounts to $2.55 per share, up from $2.45 paid earlier.
Backed by the latest dividend hike, the company’s current annual dividend yield stands at 3.57% compared with the industry’s 2.89% and the Zacks S&P 500 composite’s average yield of 1.82%.
Notably, this is the 16th consecutive year of a dividend hike by Edison International's management.
Solid Cash Flow Boosts Dividend Hike
With a strong portfolio of regulated utility assets and well-managed merchant energy operations, Edison International presents a lower risk profile than its utility-only peers.
In particular, Edison International's ability to pay dividends on its common stock is primarily dependent on the earnings and cash flows coming from its primary subsidiary, Southern (NYSE:SO) California Edison (SCE). In this regard, it is imperative to mention that in third-quarter2019, SCE core activities contributed 7 cents to the company’s overall earnings.
Such solid bottom-line performance gets translated into strong cash generation capability, which in turn, enables a company to make smooth dividend payments. Notably, as of Sep 30, 2019, this Zacks Rank #2 (Buy) stock had cash and cash equivalents of $547 million compared with $144 million at 2018 end. You can see Zacks Investment Research
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