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RenaissanceRe (RNR) Okays Dividend Hike, Boosts Shareholder Value
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RenaissanceRe Holdings Ltd.’s (RNR - Free Report) board of directors recently approved a hike of 2.8% in the quarterly dividend intending to return more value to shareholders. With the announcement, the payout now stands at 37 cents per share compared with the prior payout of 36 cents.
The increased dividend denoted the 27th straight year of dividend hike and will be paid on Mar 31, 2022 to shareholders of record as on Mar 15.
Prior to the latest hike, RenaissanceRe had raised its quarterly dividend by 2.9% to 36 cents per share in February 2021.
RNR has grown its dividend at a nine-year CAGR of 3.2%. Based on the stock’s Feb 4 closing price of $154.65, the company’s dividend yield of 0.9% remains higher than the industry’s figure of 0.4%.
Concurrent with the recent dividend hike, RenaissanceRe’s management sanctioned the renewal of its authorized share buyback program leading to the total current authorization being of up to $500 million. Leftover amounts of previous authorizations are included within the total authorization limit.
When it comes to share repurchase history, RNR boasts a sound one. In 2021, apart from paying common dividends worth $67.8 million, the insurer bought back 6.6 million shares worth $1 billion. RenaissanceRe had $306.6 million left under its buyback program as of Dec 31, 2021, consequent to which the company continued to buy back shares. Through the period ended Feb 2, 2022, RNR repurchased shares worth $76.1 million.
Such dividend raises every year and pursuit of regular share buybacks can only hint toward a company’s solid financial position. The same is the case with RenaissanceRe, which is backed with a solid cash balance and robust cash generation abilities for supporting tactical capital deployment moves.
RNR exited the fourth quarter of 2021 with a strong cash balance of $1.9 billion, which increased 7% from the figure as of Dec 31, 2020. The company generated cash flow from operations worth $1.2 billion in 2021.
With a sound liquidity position, it becomes easier for RenaissanceRe to mitigate balance sheet risks and undertake accelerated capital deployment moves. Continued share buybacks are expected to provide a boost to RNR’s bottom line. All these initiatives make the stock attractive to yield-seeking investors.
Some of the other insurers like Prudential Financial, Inc. (PRU - Free Report) , Aflac Incorporated (AFL - Free Report) and AXIS Capital Holdings Limited (AXS - Free Report) resorted to tactical capital deployment moves throughout 2021.
Prudential returned capital worth $4.3 billion to shareholders via $2.5 billion in share buybacks and $1.8 billion through dividends. Recently, PRU approved a 4% hike in the quarterly dividend. In November 2021, Prudential authorized the repurchase of up to $1.5 billion of its outstanding shares during the period from Jan 1, 2022 through Dec 31, 2022.
Aflac bought back 43.3 million shares worth $2.3 billion in 2021. As of Dec 31, 2021, AFL had 55.8 million shares left under its authorized share repurchase program. Over the past year, total dividends declared amounted to $1.32 per share. In November 2021, Aflac’s board of directors approved a 21.2% hike in the first quarter 2022 dividend, which marked the 39th straight year of a dividend hike.
W.R. Berkley returned $478.1 million in capital to shareholders in 2021, which comprised $265.3 million of special dividends, $90.4 million of regular dividends and $122.4 million of share repurchases. In November 2021, WRB approved a special cash dividend of $1.00 per share, which marked the second special dividend approved by the board in the past year. W.R. Berkley’s board has increased share repurchase authorization back to its earlier level of 10 million shares, which seems noteworthy.
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RenaissanceRe (RNR) Okays Dividend Hike, Boosts Shareholder Value
RenaissanceRe Holdings Ltd.’s (RNR - Free Report) board of directors recently approved a hike of 2.8% in the quarterly dividend intending to return more value to shareholders. With the announcement, the payout now stands at 37 cents per share compared with the prior payout of 36 cents.
The increased dividend denoted the 27th straight year of dividend hike and will be paid on Mar 31, 2022 to shareholders of record as on Mar 15.
Prior to the latest hike, RenaissanceRe had raised its quarterly dividend by 2.9% to 36 cents per share in February 2021.
RNR has grown its dividend at a nine-year CAGR of 3.2%. Based on the stock’s Feb 4 closing price of $154.65, the company’s dividend yield of 0.9% remains higher than the industry’s figure of 0.4%.
Concurrent with the recent dividend hike, RenaissanceRe’s management sanctioned the renewal of its authorized share buyback program leading to the total current authorization being of up to $500 million. Leftover amounts of previous authorizations are included within the total authorization limit.
When it comes to share repurchase history, RNR boasts a sound one. In 2021, apart from paying common dividends worth $67.8 million, the insurer bought back 6.6 million shares worth $1 billion. RenaissanceRe had $306.6 million left under its buyback program as of Dec 31, 2021, consequent to which the company continued to buy back shares. Through the period ended Feb 2, 2022, RNR repurchased shares worth $76.1 million.
Such dividend raises every year and pursuit of regular share buybacks can only hint toward a company’s solid financial position. The same is the case with RenaissanceRe, which is backed with a solid cash balance and robust cash generation abilities for supporting tactical capital deployment moves.
RNR exited the fourth quarter of 2021 with a strong cash balance of $1.9 billion, which increased 7% from the figure as of Dec 31, 2020. The company generated cash flow from operations worth $1.2 billion in 2021.
With a sound liquidity position, it becomes easier for RenaissanceRe to mitigate balance sheet risks and undertake accelerated capital deployment moves. Continued share buybacks are expected to provide a boost to RNR’s bottom line. All these initiatives make the stock attractive to yield-seeking investors.
Some of the other insurers like Prudential Financial, Inc. (PRU - Free Report) , Aflac Incorporated (AFL - Free Report) and AXIS Capital Holdings Limited (AXS - Free Report) resorted to tactical capital deployment moves throughout 2021.
Prudential returned capital worth $4.3 billion to shareholders via $2.5 billion in share buybacks and $1.8 billion through dividends. Recently, PRU approved a 4% hike in the quarterly dividend. In November 2021, Prudential authorized the repurchase of up to $1.5 billion of its outstanding shares during the period from Jan 1, 2022 through Dec 31, 2022.
Aflac bought back 43.3 million shares worth $2.3 billion in 2021. As of Dec 31, 2021, AFL had 55.8 million shares left under its authorized share repurchase program. Over the past year, total dividends declared amounted to $1.32 per share. In November 2021, Aflac’s board of directors approved a 21.2% hike in the first quarter 2022 dividend, which marked the 39th straight year of a dividend hike.
W.R. Berkley returned $478.1 million in capital to shareholders in 2021, which comprised $265.3 million of special dividends, $90.4 million of regular dividends and $122.4 million of share repurchases. In November 2021, WRB approved a special cash dividend of $1.00 per share, which marked the second special dividend approved by the board in the past year. W.R. Berkley’s board has increased share repurchase authorization back to its earlier level of 10 million shares, which seems noteworthy.
Shares of RenaissanceRe have dipped 0.8% in the past six months against the industry’s rally of 1.1%. RNR currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Shares of Prudential, Aflac and W.R. Berklely gained 46.3%, 39.8% and 35.8%, respectively, in a year.