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Canadian Pacific Rewards Investors With 27.5% Dividend Hike

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In a shareholder-friendly effort, Canadian Pacific Railway Limited (CP - Free Report) has announced a hike in its dividend payout. The move indicates the company’s sound financial position and its intention to utilize free cash for enhancing shareholders’ returns.

The company has raised its quarterly dividend by a whopping 27.5% to C$0.83 per share (C$3.32 annually). This dividend, approved by the company’s board of directors, will be paid on Jul 29, 2019 to stockholders of record as of Jun 28. The dividend yield based on this latest payout and the May 6 closing market price is approximately 1.5%.

The company has a steady track record of increasing dividends. Evidently, the latest hike marks the fourth straight year of dividend increase and reflects a 137% rise since 2014. The company has paid dividends worth C$1.47 billion and returned C$9.2 billion to shareholders ever since 2014.

As investors prefer an income-generating stock, a high dividend-yielding one is much coveted. Needless to say, investors are always on the lookout for companies that boast an impressive history of regular and incremental dividend payments.

Zacks Rank & Key Picks

Canadian Pacific carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the broader Transportation sector are CSX Corporation (CSX - Free Report) , Hertz Global Holdings, Inc (HTZ - Free Report) and SkyWest, Inc. (SKYW - Free Report) . While SkyWest sports a Zacks Rank #1 (Strong Buy), CSX and Hertz Global carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Each of the companies flaunts a stellar earnings history. While SkyWest has surpassed estimates in all the trailing four quarters, CSX and Hertz beat estimates in three of the last four quarters.

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