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Weyerhaeuser (WY) Attracts Investors With 5.6% Dividend Hike
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Weyerhaeuser Company (WY - Free Report) announced an increase in the dividend payout, following its commitment of sustainable base dividend growth by 5% annually through 2025. This is the second hike in dividend payout in the last two years.
The board of directors approved a 5.6% hike in its quarterly base cash dividend to 19 cents per share (76 cents annually) from 18 cents (72 cents annually). The new dividend will be paid out on Mar 17 to its shareholders of record as of Mar 3, 2023. The dividend yield, based on WY’s Feb 9 closing price, is approximately 2.25%.
The share price of WY dropped 0.7% during the trading session on Feb 9 but gained 1.1% in the after-hours trading session.
Consistent Dividend
Weyerhaeuser has a unique dividend structure. It pays a normal periodic dividend, a variable dividend and sometimes special dividends.Weyerhaeuser’s new cash return framework is likely to benefit the company in achieving shareholder value in the long term under any given market conditions. Per the framework, the company supplements its quarterly base cash dividend, along with an extra return of variable cash, to achieve a targeted total return to shareholders of 75%-80% of annual adjusted Funds Available for Distribution (adjusted FAD). During 2022, the adjusted FAD was $2.3 billion compared with $2.6 billion at 2021-end.
The company returned total cash of $1.75 billion to its shareholders based on 2022 results, including $550 million of share repurchases completed in the period.
As of fourth-quarter 2022, cash and cash equivalents were $1.6 billion compared with $1.9 billion 2021-end.
Image Source: Zacks Investment Research
The shares of the company grew 2.2% compared with the Zacks Building Products - Wood industry’s growth of 6.5% over the past three months.
Although this leading timber provider remains vulnerable to various challenges like weather conditions, inflation, transportation cost and dynamic market conditions, its solid portfolio, industry-leading performance, strong ESG foundation and disciplined capital allocation are tailwinds.
United Rentals currently sports a Zacks Rank #1. Shares of URI have gained 43.8% in the past year. The long-term earnings growth rate of the company is 16.3%.
The Zacks Consensus Estimate for URI’s 2023 sales and EPS suggests growth of 20.7% and 26.9%, respectively, from the year-ago period’s reported levels.
Skyline currently flaunts a Zacks Rank #1. SKY has a trailing four-quarter earnings surprise of 43.2%, on average. Its shares have rallied 24.6% in the past three months.
The Zacks Consensus Estimate for SKY’s 2024 sales and EPS suggests decline of 11.7% and 37.9%, respectively, from the 2023 period’s reported levels.
Sterling currently carries a Zacks Rank #2. STRL has a trailing four-quarter earnings surprise of 20%, on average. Shares of the company have gained 24.5% in the past year.
The Zacks Consensus Estimate for STRL’s fiscal 2023 sales and EPS suggests growth of 0.6% and 9.9%, respectively.
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Weyerhaeuser (WY) Attracts Investors With 5.6% Dividend Hike
Weyerhaeuser Company (WY - Free Report) announced an increase in the dividend payout, following its commitment of sustainable base dividend growth by 5% annually through 2025. This is the second hike in dividend payout in the last two years.
The board of directors approved a 5.6% hike in its quarterly base cash dividend to 19 cents per share (76 cents annually) from 18 cents (72 cents annually). The new dividend will be paid out on Mar 17 to its shareholders of record as of Mar 3, 2023. The dividend yield, based on WY’s Feb 9 closing price, is approximately 2.25%.
The share price of WY dropped 0.7% during the trading session on Feb 9 but gained 1.1% in the after-hours trading session.
Consistent Dividend
Weyerhaeuser has a unique dividend structure. It pays a normal periodic dividend, a variable dividend and sometimes special dividends.Weyerhaeuser’s new cash return framework is likely to benefit the company in achieving shareholder value in the long term under any given market conditions. Per the framework, the company supplements its quarterly base cash dividend, along with an extra return of variable cash, to achieve a targeted total return to shareholders of 75%-80% of annual adjusted Funds Available for Distribution (adjusted FAD). During 2022, the adjusted FAD was $2.3 billion compared with $2.6 billion at 2021-end.
The company returned total cash of $1.75 billion to its shareholders based on 2022 results, including $550 million of share repurchases completed in the period.
As of fourth-quarter 2022, cash and cash equivalents were $1.6 billion compared with $1.9 billion 2021-end.
Image Source: Zacks Investment Research
The shares of the company grew 2.2% compared with the Zacks Building Products - Wood industry’s growth of 6.5% over the past three months.
Although this leading timber provider remains vulnerable to various challenges like weather conditions, inflation, transportation cost and dynamic market conditions, its solid portfolio, industry-leading performance, strong ESG foundation and disciplined capital allocation are tailwinds.
Zacks Rank & Key Picks
WY currently carries a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Some better-ranked stocks in the Zacks Construction sector are United Rentals, Inc. (URI - Free Report) , Skyline Champion Corporation (SKY - Free Report) and Sterling Infrastructure, Inc. (STRL - Free Report) .
United Rentals currently sports a Zacks Rank #1. Shares of URI have gained 43.8% in the past year. The long-term earnings growth rate of the company is 16.3%.
The Zacks Consensus Estimate for URI’s 2023 sales and EPS suggests growth of 20.7% and 26.9%, respectively, from the year-ago period’s reported levels.
Skyline currently flaunts a Zacks Rank #1. SKY has a trailing four-quarter earnings surprise of 43.2%, on average. Its shares have rallied 24.6% in the past three months.
The Zacks Consensus Estimate for SKY’s 2024 sales and EPS suggests decline of 11.7% and 37.9%, respectively, from the 2023 period’s reported levels.
Sterling currently carries a Zacks Rank #2. STRL has a trailing four-quarter earnings surprise of 20%, on average. Shares of the company have gained 24.5% in the past year.
The Zacks Consensus Estimate for STRL’s fiscal 2023 sales and EPS suggests growth of 0.6% and 9.9%, respectively.