The board of directors of Chubb Limited CB recently approved a hike in its quarterly dividend. The company will now pay out a dividend of 78 cents per share compared with 75 cents paid on Jul 12, 2019, which reflects an increase of 4%.
Shareholders of record as of Jun 19, 2020 will receive the increased quarterly dividend of 78 cents ($3.12 on an annualized basis) on Jul 10, 2020.
Prior to this, in May 2019, it hiked annual dividend by 2.5%, which marked the 26th straight year of dividend hike.
This recent hike marked the 27th consecutive dividend increase by the company. Chubb has a stellar track of paying quarterly dividends and raising its payout each year. Chubb has more than doubled its quarterly dividend since 2010, reflecting sustained solid operational performance. Based on the closing price of $104.61 as of May 20, the company’s dividend yield is 2.9%, much above the industry average of 1.2%. Notably, the company has consistently hiked its dividend with the metric witnessing a five-year CAGR (2014-2019) of 8.45%.
Apart from continuous dividend increases, Chubb aggressively buys back shares to boost its bottom line. In the first quarter of 2020, the company bought back shares worth $326 million. The company still has $1.12 billion remaining under its share repurchase authorization.
Board members of RLI Corp. RLI — another property and casualty insurer which also aims at enhancing shareholder value via dividend hikes — approved an increase in its quarterly payout by 4.3%.
Shares of this Zacks Rank #4 (Sell) property and casualty insurer have underperformed the industry in the past year. The stock has lost 29.4% compared with the industry’s decline of 18.6%. Nevertheless, the company’s expanded capabilities, strategic growth initiatives and effective capital deployment should help the stock sustain momentum.
Stocks That Warrant a Look
Some better-ranked stocks from the same space are The Allstate Corporation ALL and Palomar Holdings Inc. PLMR each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Allstate surpassed estimates in each of the last four quarters, with the average positive surprise being 18.45%.
Palomar surpassed estimates in two of the last four quarters, with the average positive surprise being 10.93%.
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The Allstate Corporation (ALL) : Free Stock Analysis Report
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