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Hawaiian Electric (HE) Announces 2.9% Hike in Dividend Payout
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Hawaiian Electric Industries, Inc. (HE - Free Report) recently announced that its board of directors approved a hike in its quarterly dividend to 36 cents per share, reflecting an increase of 2.9% from the prior payout.
With the current hike, the company will now pay out an annual dividend of $1.44 per share. This represents an annual dividend yield of 3.39% based on its share price worth $42.41 as of Feb 10.
The annualized dividend yield is higher than the industry’s yield of 3.14% and the Zacks S&P 500 composite’s yield of 1.52%. This signifies Hawaiian Electric’s strength in the business to generate enough cash flow to reward shareholders with improved dividend payouts.
Will Hawaiian Electric Sustain Dividend Hikes?
Hawaiian Electric has been consistently boosting shareholder returns, as gauged by its payout of 63% in the first nine months of 2022, higher than the payout ratio of 60% in 2021.
The solid distribution strategy is generally buoyed by a steady performance of a company in generating sales and stable cash flow from operations. Hence, it is imperative to mention that HE recorded a 37.7% increase in its sales in the last reported quarter, while its operating cash flow came in at $124.2 million at the end of the third quarter of 2022.
Going forward, the company expects to generate earnings in the band of $2.08-$2.20. Such an earnings expectation may allow the company to sustain dividend hikes in the days ahead.
Moreover, Hawaiian Electric being the largest provider of electricity in Hawaii may witness a rise in its flow of income as Hawaii continues to witness improving trends in tourism and construction, the two major drivers of electricity consumption in the region. In light of the aforementioned factors, one may conclude that HE may continue to undertake such shareholder-friendly moves going forward.
Peer Moves
Utilities have a tendency to boost shareholder returns, buoyed by a steady flow of income in their business, which supports dividend hikes. Apart from Hawaiian Electric, utilities that have rewarded shareholders with an improved dividend rate are as follows:
In February 2023, CMS Energy Corporation (CMS - Free Report) approved a hike in its quarterly dividend to 48.75 cents per share, reflecting an increase of 6% from the prior payout.
CMS Energy boasts a long-term earnings growth rate of 7.9%. Shares of CMS Energy have delivered 6.2% in the past three months.
In the same month, Ameren Corporation’s (AEE - Free Report) board of directors approved a hike in its quarterly dividend to 63 cents per share, reflecting an increase of 7% from the prior payout.
AEE’s long-term earnings growth rate is pegged at 6.9%. Ameren shares have risen 3.7% in the past three months.
In December 2022, PNM Resources (PNM - Free Report) increased the company's annual dividend payout by $0.08, which is a 5.8% increase. This represents an annual dividend rate of $1.47 per share of the common stock.
PNM has a long-term earnings growth rate of 4.2%. Shares of PNMResources have increased 11.1% in the past year.
Price Movement
In the past three months, shares of Hawaiian Electric have risen 9.2% compared with the industry’s growth of 0.8%.
Image: Bigstock
Hawaiian Electric (HE) Announces 2.9% Hike in Dividend Payout
Hawaiian Electric Industries, Inc. (HE - Free Report) recently announced that its board of directors approved a hike in its quarterly dividend to 36 cents per share, reflecting an increase of 2.9% from the prior payout.
With the current hike, the company will now pay out an annual dividend of $1.44 per share. This represents an annual dividend yield of 3.39% based on its share price worth $42.41 as of Feb 10.
The annualized dividend yield is higher than the industry’s yield of 3.14% and the Zacks S&P 500 composite’s yield of 1.52%. This signifies Hawaiian Electric’s strength in the business to generate enough cash flow to reward shareholders with improved dividend payouts.
Will Hawaiian Electric Sustain Dividend Hikes?
Hawaiian Electric has been consistently boosting shareholder returns, as gauged by its payout of 63% in the first nine months of 2022, higher than the payout ratio of 60% in 2021.
The solid distribution strategy is generally buoyed by a steady performance of a company in generating sales and stable cash flow from operations. Hence, it is imperative to mention that HE recorded a 37.7% increase in its sales in the last reported quarter, while its operating cash flow came in at $124.2 million at the end of the third quarter of 2022.
Going forward, the company expects to generate earnings in the band of $2.08-$2.20. Such an earnings expectation may allow the company to sustain dividend hikes in the days ahead.
Moreover, Hawaiian Electric being the largest provider of electricity in Hawaii may witness a rise in its flow of income as Hawaii continues to witness improving trends in tourism and construction, the two major drivers of electricity consumption in the region. In light of the aforementioned factors, one may conclude that HE may continue to undertake such shareholder-friendly moves going forward.
Peer Moves
Utilities have a tendency to boost shareholder returns, buoyed by a steady flow of income in their business, which supports dividend hikes. Apart from Hawaiian Electric, utilities that have rewarded shareholders with an improved dividend rate are as follows:
In February 2023, CMS Energy Corporation (CMS - Free Report) approved a hike in its quarterly dividend to 48.75 cents per share, reflecting an increase of 6% from the prior payout.
CMS Energy boasts a long-term earnings growth rate of 7.9%. Shares of CMS Energy have delivered 6.2% in the past three months.
In the same month, Ameren Corporation’s (AEE - Free Report) board of directors approved a hike in its quarterly dividend to 63 cents per share, reflecting an increase of 7% from the prior payout.
AEE’s long-term earnings growth rate is pegged at 6.9%. Ameren shares have risen 3.7% in the past three months.
In December 2022, PNM Resources (PNM - Free Report) increased the company's annual dividend payout by $0.08, which is a 5.8% increase. This represents an annual dividend rate of $1.47 per share of the common stock.
PNM has a long-term earnings growth rate of 4.2%. Shares of PNMResources have increased 11.1% in the past year.
Price Movement
In the past three months, shares of Hawaiian Electric have risen 9.2% compared with the industry’s growth of 0.8%.
Image Source: Zacks Investment Research
Zacks Rank
Hawaiian Electric currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.