Back to top

Analyst Blog

This page is temporarily not available.  Please check later as it should be available shortly. If you have any questions, please email customer support at support@zacks.com or call 800-767-3771 ext.  9339.

Oil and gas operator, Anadarko Petroleum Corp.’s (APC - Analyst Report) board of directors announced its approval of a 100% hike in the quarterly dividend rate payable on Sep 25, 2013, to shareholders of record at the close of business on Sep 11, 2013. The company doubled its quarterly dividend to 18 cents from the prior 9 cents.

Anadarko Petroleum has consistently performed well recording healthy earnings surprises in the last four quarters, which led to an average earnings beat of 18.65%. This paved the way for the current dividend increase.

Its strong financial performance in the second quarter of 2013 also prompted the company to take this step. It registered an 85.4% increase in the cash balance to $4.6 billion in the second quarter from $2.5 billion as of Dec 31, 2012. This was supported by a 25.2% year-over-year increase in operating cash flow to $2.5 billion at the end of Jun 30, 2013.

The hike in the quarterly cash dividend speaks of Anadarko’s efforts to boost shareholder wealth. Although the company’s dividend history has not been that striking, we believe the current dividend raise will most certainly capture investors’ attention in the stock.

The sound balance sheet position will encourage the company’s ongoing multiple exploration ventures in the Gulf of Mexico and Mozambique, which will accentuate its returns. Moreover, the shale resources are offering attractive growth opportunities, which the company will capitalize through its sizeable interests in the resource-rich East Texas and Wattenberg horizontal plays.

We anticipate these factors will help position Anadarko Petroleum for future growth. However, it needs to tread cautiously owing to the lingering threat of political instability in Africa. The company at the moment carries a Zacks Rank #3 (Hold).

Other operators in the sector hiking their dividends in the first half of 2013 include Occidental Petroleum Corp. (OXY - Analyst Report), with a raise of 18.5% to 64 cents, Magellan Midstream Partners LP (MMP - Analyst Report) increasing the quarterly cash distribution by 21% to 50.8 cents and Markwest Energy Partners, L.P. (MWE - Analyst Report) raising the cash distribution by 5.0% to 84 cents.

Based in The Woodlands, Texas, Anadarko Petroleum presently has a market capitalization of $40.88 billion.
 

Please login to Zacks.com or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research

Close

Are you a new Zacks Member or a visitor to Zacks.com?

Top Zacks Features

Learn more

Start for as little as $4.50 per trade.

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
DIXIE GRP IN DXYN 15.84 +7.90%
BOFI HLDG IN BOFI 85.30 +4.97%
RAMBUS INC RMBS 12.31 +4.41%
VIPSHOP HOLD VIPS 148.73 +4.35%
NETFLIX INC NFLX 345.74 +4.32%