CenterPoint Energy Inc. ( CNP - Analyst Report ) has increased its quarterly dividend to share more benefits with its shareholders, as it did in January 2012. The company increased its dividend by 2.5%, bringing the annualized dividend to 83 cents per share from the previous payout of 81 cents per share. The increment reflects the company’s commitment towards its shareholders and its ability to deliver sustainable earnings and cash flow.

Following the hike, the company will now pay a quarterly dividend of 20.75 cents compared to its previous payout of 20.25 cents. The dividend will be paid on Mar 8, 2013, to shareholders of record as of the close of business on Feb 15, 2013.

The company has been able to increase its dividend for the eighth consecutive year. Last January, the company had increased its quarterly dividend by 2.5% to 20.25 cents per share.

CenterPoint Energy with its balanced portfolio of electric and natural gas businesses provides a diversified risk profile, along with stable earnings and cash flow. The company believes that in the near term it requires cash to fulfill its dividend payment, capital expenditure requirements and interest payments on debt. It believes that the capital expenditures will maintain reliability and safety as well as help in expanding the systems through value-added projects.

Going forward, key growth drivers for the company include stable regulated operations, higher rates, ongoing infrastructure development projects and a strong balance sheet.

However, the positives are partially offset by some pending regulatory cases including the outcome of the Texas rate case, the tepid economy, lower demand for electricity, falling wholesale natural gas prices and a significant presence in a hurricane prone section of the U.S. CenterPoint Energy has a short-term Zacks Rank #3 (Hold rating) in view of the continued weak economic environment in the U.S. which will weigh on the company’s power sales. In the near term, we would advise investors to focus on its Zacks Rank #1 (short-term Strong Buy rating) peers like Ameren Corporation ( AEE - Analyst Report ) , Integrys Energy Group, Inc. ( TEG - Analyst Report ) and Pike Electric Corporation ( PIKE - Snapshot Report ) .

CenterPoint Energy is expected to release its earnings on Feb 27, 2013. The Zacks Consensus Estimates for the fourth quarter 2012 and full year 2012 are currently at 21 cents per share and $1.19 per share, respectively.

Based in Houston, Texas, CenterPoint Energy is a domestic energy delivery company that includes electric transmission & distribution, natural gas distribution, competitive natural gas sales and services, interstate pipelines, and field services operations. The company serves more than five million metered customers primarily in Arkansas, Louisiana, Minnesota, Mississippi, Oklahoma and Texas.