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Alberto Abaterusso
Alberto Abaterusso
Articles (1791) 

2 Large-Cap Stocks Announce Dividends

Dividend updates for some prominent long-term payers

November 15, 2019 | About:

Nike Inc (NYSE:NKE) and Motorola Solutions Inc (NYSE:MSI) announced upcoming dividends on Thursday. These large-cap stocks have also been paying dividends for many years.

Nike

Shares of Nike traded higher by $0.23 (or 0.25%), trading at a price of $91.50 after-hours on Thursday after the company announced a quarterly dividend of 24.5 cents per common share, which reflects an 11.4% increase from the previous payment of 22 cents.

Nike will pay the quarterly dividend to its shareholders on Jan 2, 2020. In order to benefit, shareholders must be on the company’s book not later than Dec. 2. The ex-dividend date is scheduled for Nov. 29.

Based on Thursday ’s closing price of $91.27 at the end of regular trading, the payment produces a forward dividend yield of 1.07%. As of Nov. 14, the industry median yields 2.69% and the S&P 500 grants 1.85%.

The Beaverton, Oregon-based footwear and apparel corporation has continuously paid quarterly dividends since March 21, 1986.

The trailing 12-month dividend per share has increased 13.1% on average over the last five years through May. 28, 2018.

Nike sustains the payment of the dividend thanks to $3.64 billion cash available on hand as of Aug. 30 earlier this year and $5 billion in cash flows generated from operations in the last 12 months through the quarter ended Aug. 30 (Nike's first quarter of fiscal 2020).

The stock price has risen 23% year to date. The 52-week range is $66.53 to $96.87.

The stock has a market capitalization of $142.5 billion, a price-earnings ratio of 34.06, a price-book ratio of 15.85 and a price-sales ratio of 3.69.

Based on the Peter Lynch chart, the stock seems to be trading above its fair value.

Wall Street sell-side analysts have issued an overweight recommendation rating with an average target price of $103.23 per share.

Motorola Solutions

Shares of Motorola Solutions closed slightly higher by $0.14 (or 0.09%), trading at a price of $161.74 at the end of regular trading on Thursday following the announcement of a quarterly dividend of 64 cents per common share, which reflects a 12.3% hike from the previous payment of 57 cents.

Motorola will send the payment out to its shareholders on Jan. 15. 2020. Investors must be registered on the book of the company not later than Dec. 13 if they want to receive the payment. The ex-dividend date is Dec. 12.

The company produces a forward dividend yield of 1.58% versus the industry median of 2.57% and the S&P 500's yield of 1.85%, based on share prices at close on Thursday.

Except for a few quarters, the Chicago-based mission-critical communication solutions provider has paid dividends for each quarter from Jan. 15, 1986 to Oct. 15, 2019.

The trailing 12-month dividend per share averaged 13.7% growth over the past five years through Dec. 28, 2018, as indicated by the chart below from GuruFocus.

Motorola supports the payment of the quarterly dividend with $1.14 billion in cash available on hand, plus $1.84 billion in trailing 12-month cash flows from operating activities. Figures are as of Sept. 29.

The stock has gained 41% year to date. The 52-week range is $108.25 to $182.28.

The stock has a market capitalization of $27.71 billion, a price-earnings ratio of 27 and a price-sales ratio of 3.65.

The Peter Lynch earnings line indicates the stock is trading a bit over its fair value.

Sell-side analysts in Wall Street issued an overweight recommendation rating with an average target price of $186.89.

Disclosure: I have no positions in any securities mentioned.

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About the author:

Alberto Abaterusso
If somebody asks what being a value investor means, Alberto Abaterusso would answer, “The value investor is not just the possessor of the security that represents the company, but he is the owner of that company. As an owner of the company the value investor is actively involved in the dynamics of that company and his first concern is how to have sales progressively growing. Also, the value investor is probably one of the most demanding persons in the world concerning sales.”

Abaterusso is a freelance writer based in The Netherlands. He primarily writes about gold, silver and precious metals mining stocks. His articles have also been widely linked by popular sites, including MarketWatch, Financial Times, 24hGold, Investopedia, Financial.org, CNBS, MSN Money, Zachs, Reuters and others. Alberto holds an MBA from Università degli Studi di Bari (Italy), Aldo Moro.

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