Dividend Coverage: This Retail REIT Raised its Dividend by 4.2%; Will Trade Ex-Dividend on November 09, 2017
LONDON, UK / ACCESSWIRE / November 8, 2017 / Pro-Trader Daily takes a closer look at The Macerich Co. (NYSE: MAC) as the Company's stock will begin trading ex-dividend on November 09, 2017. In order to capture the dividend payout, investors must purchase the stock a day prior to the ex-dividend date that is by latest at the end of the trading session on November 08, 2017. Are you looking for research on dividend stocks, if so register with us now for your free membership at:
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Dividend Declared
On October 24, 2017, Macerich's Board of Directors declared a 4.2% increase in its quarterly cash dividend to $0.74 per share of common stock. The dividend is payable on December 01, 2017, to stockholders of record at the close of business on November 10, 2017.
Macerich's indicated dividend represents a yield of 5.44%, which is substantially above the average dividend yield of 3.27% for the financial sector. The Company has raised dividend for six consecutive years.
Dividend Insights
Macerich has a dividend payout ratio of 74.7%, which indicates that the Company distributes approximately $0.74 for every $1.00 earned. The dividend payout ratio reflects how much amount a company is returning to shareholders versus how much money it is keeping on hand to reinvest in growth, to pay off debt, and/or to add to its cash reserves.
According to analysts' estimates, Macerich is forecasted to report earnings of $0.83 for the next year compared to the Company's annualized dividend of $2.96. One of the primary reasons for the difference between earnings and annualized dividend is that Macerich is a Real Estate Investment Trust (REIT) which is structured by law to distribute at least 90% of earnings. Moreover, since REITs generate income from owning portfolios of investment real estate, they are likely to have higher depreciation charges.
Since depreciation is a non-cash charge, it does not directly impact the ability of dividend the companies can distribute. For this reason, Fund from Operations (FFO) is calculated by adding depreciation and amortization to earnings and subtracting any gains on sales which then provides a better picture of any company's profitability and capacity to pay and to sustain dividends. For instance, Macerich reported net income attributable to the Company of $17.5 million, or $0.12 per share-diluted, for the quarter ended September 30, 2017, compared to net income attributable to the Company for the quarter ended September 30, 2016, of $13.7 million or $0.09 per share-diluted. For Q3 2017, Macerich's funds from operations ("FFO") diluted was $145.0 million or $0.96 per share-diluted compared to $160.3 million, or $1.04 per share-diluted, for Q3 2016.
As of September 30, 2017, Macerich had $71.09 million of cash and cash equivalents compared to cash of $94.05 million as on December 31, 2016. For the nine months of 2017, the Company's cash provided by operating activities totaled $299.85 million compared to $331.09 million in the year-ago same period. The Company's strong financial position indicates its ability to absorb any fluctuations in earnings and cash flow and to sustain the dividend distribution for a long period.
About Macerich
Macerich, an S&P 500 Company, is a fully integrated self-managed and self-administered real estate investment trust, which focuses on the acquisition, leasing, management, development, and redevelopment of regional malls throughout the United States.
Macerich currently owns 54 million square feet of real estate consisting primarily of interests in 48 regional shopping centers. Macerich specializes in successful retail properties in many of the country's most attractive, densely populated markets with significant presence in the Pacific Rim, Arizona, Chicago and the Metro New York to Washington, DC corridor.
Stock Performance
At the close of trading session on Tuesday, November 07, 2017, Macerich's stock price rose 8.43% to end the day at $58.76. A total volume of 5.83 million shares were exchanged during the session, which was above the 3-month average volume of 1.54 million shares. In the last month, shares of the Company have advanced 3.21%. The Company's shares are trading at a PE ratio of 57.78 and have a dividend yield of 5.04%. At Tuesday's closing price, the stock's net capitalization stands at $8.50 billion.
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