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Pinnacle Foods Boosts Shareholder Value, Hikes Dividend

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Pinnacle Foods, Inc. regularly enhances shareholder value through dividend payouts.

The board of directors of the company recently approved a quarterly dividend hike of 12% to 28.5 cents per share. The new dividend will be payable on Oct 10, 2016, to shareholders of record as of Aug 30. The raise brings the annualized dividend to $1.14 per share, implying an increase from the previous annualized rate of $1.02 per share. The new annualized dividend yields an impressive 2.3% based on Pinnacle Foods' closing price of $49.52 as of Aug 16, 2016. The recent announcement reflects the company’s strong cash position.

Notably, this was the fourth dividend increase by Pinnacle Foods since the initiation of its quarterly dividend program shortly after its IPO in Mar 2013. The last dividend hike of 8.5% to 25.5 cents per share was announced in Sep 2015.

Parsippany, NJ-based Pinnacle manufactures a wide variety of prepackaged foods under multiple brand names. Its products include Duncan Hines cake mix, Mrs. Butterworth's syrup and Vlasic pickles.

PINNACLE FOODS Price and Consensus

 

PINNACLE FOODS Price and Consensus | PINNACLE FOODS Quote

Last month, the company reported mixed second-quarter 2016 results. While earnings beat the Zacks Consensus Estimate, revenues missed the same. Pinnacle Foods has also raised its earnings guidance for 2016, which includes the benefit of the Boulder Brands acquisition.

Overall, the company boasts a strong brand portfolio and intends to continue to invest in innovation to further differentiate its brands in the marketplace. It has also been pursuing various acquisitions over the years to enhance distribution network, customer base and boost long-term growth.

Pinnacle Foods also has an operational excellence program to generate annual productivity savings across the supply chain. These productivity savings, along with higher pricing, have been mitigating the impact of input cost inflation to drive gross margins.

Pinnacle Foods carries a Zacks Rank #2 (Buy).

Key Picks from the Sector

Investors interested in the food industry can also consider stocks like Omega Protein Corp. , Ingredion, Inc. (INGR - Free Report) and Sysco Corp. (SYY - Free Report) . While Omega Protein and Ingredion sport a Zacks Rank #1 (Strong Buy), Sysco holds a Zacks Rank #2.

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