Caterpillar Raises Dividend for 18th Consecutive Year
Caterpillar (CAT: 74.90 -2.01%) today announced a quarterly dividend increase of 5% to $.46 per share and reaffirmed their 2011 forecast.
After the dividend increase, Caterpillar stock will offer a current yield of 1.9%. That dividend yield has declined significantly over the past year as Caterpillar’s stock has gained 73% over the past 12 months.
Caterpillar has now paid a regular dividend every quarterly since 1933 and has given their shareholders a dividend increase for 18 consecutive years. Last year, Caterpillar announced a similar 5% dividend increase.
“This dividend increase is another example of Caterpillar’s commitment to increasing value for our stockholders,” said Caterpillar Chairman and Chief Executive Officer Doug Oberhelman. “In addition to increasing the dividend, our focus on cash flow and the strength of our financial position enabled us to finance the Bucyrus acquisition without the need for equity and is enabling substantial investment to prepare Caterpillar for the developing improvement in the business cycle and to achieve our long-term financial goals,”
Caterpillar also reaffirmed their 2011 financial guidance for revenues of $52 – $54 billion and EPS of $6.25 – $6.75. However, that failed to reassure investors who sent CAT shares down 2% in late afternoon trading. This month Caterpillar has seen their stock price decline 7.5%.
Despite the recent slide in Caterpillar’s stock price, we view the stock as one of 6 blue chip dividend stocks that will outperform the market over the next 6 months.
The Caterpillar dividend will be payable on August 20, 2011 to shareholders of record as of July 20, 2011.