National Oilwell Hikes Dividend - Analyst Blog
23 Maggio 2013 - 12:05AM
Zacks
Global large-cap energy equipment
maker, National Oilwell Varco (NOV) has recently
increased its quarterly cash dividend payment by 100% to 26 cents
per share, up from 13 cents per share paid in the previous quarter.
The new dividend will be paid on Jun 28, 2013, to shareholders of
record as on Jun 14, 2013.
Importantly, National Oilwell has been increasing its payout every
year since it commenced paying dividends in 2009. If the current
dividend is maintained for a year, the annualized dividend payout
of the company would be $1.04 per share.
Based on the closing price of $70.17 as on May 20, 2013, the
proposed dividend affirms a yield of 1.5%. A steady dividend payout
facilitates the long-term strategy of the company to provide
attractive risk-adjusted returns to its stockholders.
Management believes the dividend hike shows consistently good
performance and is reflective of its solid operating results.
Houston, Texas based National Oilwell is a world leader in the
design, manufacture, and sale of comprehensive systems, components,
products, and equipment used in oil and gas drilling and production
worldwide. The company reached its current form following the Mar
2005 merger between National Oilwell and Varco International.
National Oilwell organizes its operations in three business
segments: Rig Technology, Petroleum Services & Supplies, and
Distribution & Transmission.
With new competitors entering the market and reduced capital
expenditure by the drilling contractors, National Oilwell has seen
its new equipment package pricing fall around 10% below the level
achieved during the peak of 2007–2008. In particular, the company’s
margins have been hit hard by the ongoing North American drilling
slump. We expect the situation – characterized by tepid demand and
weak pricing – to normalize only sometime in late 2013.
National Oilwell currently carries a Zacks Rank #4 (Sell), implying
that it is expected to underperform the broader U.S. equity market
over the next one to three months.
However, in the energy sector three firms that are expected to
significantly outperform the broader U.S. equity market over the
next one to three months are CNOOC Ltd. (CEO),
InterOil Corporation (IOC) and EPL Oil
& Gas Inc. (EPL). All three firms retain a Zacks Rank
#1 (Strong Buy).
CNOOC LTD ADR (CEO): Free Stock Analysis Report
EPL OIL&GAS INC (EPL): Free Stock Analysis Report
INTEROIL CORP (IOC): Free Stock Analysis Report
NATL OILWELL VR (NOV): Free Stock Analysis Report
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