Fortune Brands (FBHS) Hikes Quarterly Dividend Rate by 7.7%
Fortune Brands Home & Security, Inc. FBHS yesterday announced a 7.7% hike in the quarterly dividend rate. The improved reward for shareholders suggests a strong cash position and profitability for Fortune Brands.
The dividend hike marks Fortune Brands’ 9th increment (annual) in a row.
Inside the Headlines
The board of directors of Fortune Brands approved a hike of 2 cents per share in the quarterly dividend rate. The rate now stands at 28 cents per share, higher than the previous quarterly dividend rate of 26 cents. On an annualized basis, the dividend rate has been improved from $1.04 to $1.12.
The company will pay out the revised quarterly dividend on Mar 16, 2022, to shareholders of record as of Feb 25.
Sound Capital-Allocation Strategies
Fortune Brands follows sound capital-allocation strategies, aiming to improve shareholder values. Free resources are primarily used for buyouts, rewarding shareholders, product development and expanding market presence.
In the first nine months of 2021, the company’s dividend payments totaled $107.9 million, up 8% from $99.9 million disbursed in the year-ago period.
In addition to dividends, Fortune Brands rewarded shareholders through share buybacks worth $252.9 million in the first three quarters of 2021. Shares worth $150 million were repurchased in the year-ago period. The company was left to buy back $192.4 million worth of shares from its approved programs at the end of the third quarter of 2021. Also, the company has an approved share buyback program worth $400 million (announced in July 2021) left to use.
Zacks Rank, Price Performance and Earnings Estimate Trend
With a market capitalization of $14.2 billion, Fortune Brands currently carries a Zacks Rank #3 (Hold). Solid demand for plumbing and security products, inorganic actions, and rewards to shareholders are beneficial for Fortune Brands. Supply-chain woes, and high costs and dents are concerning.
In the past three months, Fortune Brands’ shares have gained 9.1% against the industry’s decline of 4.7%.
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The Zacks Consensus Estimate for Fortune Brands’ earnings is pegged at $5.71 for 2021 and $6.43 for 2022. The consensus estimate reflects a decline of 1.7% for 2021 and an increase of 0.8% for 2022 from the respective 60-day-ago figures. The same for the fourth quarter of 2021 is pegged at $1.30, marking a decline of 11.6% from the 60-day-ago figure.
Fortune Brands Home & Security, Inc. Price and Consensus
Fortune Brands Home & Security, Inc. price-consensus-chart | Fortune Brands Home & Security, Inc. Quote
Dividend Hikes by Three Industry Players
Below we discussed three other companies from the industry, which reward their shareholders with hiked quarterly dividend rates.
Ethan Allen Interiors Inc. ETD hiked its quarterly dividend rate by 16% or 4 cents per share to 29 cents in November 2021. Dividends totaling $25.4 million were paid out in first-quarter fiscal 2022 (ended Sep 30, 2021).
Ethan Allen presently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The company’s earnings estimates improved 16.1% for fiscal 2022 (ending June 2022) and 7.1% for fiscal 2023 (ending June 2023) in the past 60 days. Earnings surprise for the last reported quarter was 23.08%.
Tempur Sealy International, Inc. TPX increased its quarterly dividend rate by 28.6% or 2 cents per share in July 2021. Total dividend disbursements were $45.8 million in the first nine months of 2021.
Tempur Sealy’s earnings estimates have improved 1.2% for 2021 and 4.9% for 2022 in the past 60 days. This Zacks Rank #2 company’s earnings surprise for the last reported quarter was 3.53%.
Williams-Sonoma, Inc. WSM hiked its quarterly dividend rate by 20% or 12 cents per share in August 2021. In the first nine months of fiscal 2021 (ended Oct 31, 2021), its dividend payments totaled $135.2 million.
Williams-Sonoma presently carries a Zacks Rank #2. In the past 60 days, earnings estimates for the company improved 4.7% for fiscal 2021 (ending January 2022) and 7% for fiscal 2022 (ending January 2023). Also, earnings surprise in the last reported quarter was 6.75%.
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