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The Hanover Insurance (THG) Stock Up Since Dividend Hike

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Shares of The Hanover Insurance Group (THG - Free Report) gained 0.8% in the last two days as its board of directors approved a 7.7% hike in quarterly dividend. With this, the payout now stands at 70 cents per share compared with the earlier payout of 65 cents per share.

Based on the stock’s Dec 7 closing price of $114.84, the new dividend will yield 2.4%, better than the industry average of 0.4%. With 38 million shares outstanding, this Zacks Rank #2 (Buy) looks to allocate about $26.6 million quarterly to pay the dividend. Shareholders of record on Dec 18, 2020 will receive the meatier dividend on Dec 30.

The company has increased dividend each year, reflecting operational excellence and the company’s commitment to return value to its shareholders. The company’s dividend witnessed a 10-year CAGR of 10.4%.

The Hanover Insurance Group prudently deploys capital in profitable business initiatives and returns the excess capital to shareholders. Last year, the company approved three accelerated share repurchase programs and two special dividends. In the first nine months of 2020, it bought back 5.4 million shares under this $900 million program and has about $242 million remaining under authorization.

Building on specialty portfolio, expanding new product capabilities, including excess and surplus, cyber and financial institutions, boosting professional liability platform, and a solid local market presence should help the company maintain the streak.

Shares of The Hanover Insurance Group have lost 16% year to date compared with the industry’s decrease of 5.6%. Operational excellence and solid capital position should help shares bounce back.


Recently, the board of directors of American Equity Investment Life Holding Company (AEL - Free Report) approved a 6% hike in its annual dividend. Assurant’s (AIZ - Free Report) board of directors approved a 5% hike while the board of directors AXIS Capital Holdings Limited (AXS - Free Report) approved a 2.4% hike in its annual dividend.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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