IDACORP (IDA) Rewards Shareholders With 5.1% Dividend Hike
IDACORP Inc. IDA announced that its board of directors approved a 5.1% increase in its quarterly dividend rate. The revised quarterly dividend will be 83 cents. The company’s new annualized dividend rate is $3.32 and the current dividend yield is 3.42%, better than the Zacks S&P 500 composite’s 1.71%.
IDACORP’s management has been raising its dividend rate annually over the past few years. It belongs to an exclusive group of companies that have raised dividend rates every year since 2012. The company’s board of directors approved a dividend increase this month, leading to a total increase of 177% in annualized dividends since 2011.
In the long term, management aims to raise the dividend rate by nearly 5%. This would keep IDACORP near the upper end of the current target payout ratio, between 60% and 70%.
Can IDACORP Sustain Dividend Hikes?
IDACORP’s regulated electric operations in Idaho generate a relatively stable earnings stream. Ongoing economic improvements in its service territories have helped the company expand its customer base. These factors are positively impacting its operating income.
It projects capital expenditure in the range of $2.9-$3.2 billion in the 2023-2027 period. Owing to systematic investments in strengthening the generation portfolio, Idaho Power Hydroelectric Generation will be able to cater to the rising demand of its expanding customer base.
The company has undertaken initiatives to enhance its financial strength and improve its core business. The ongoing increase in the customer base and its steady performance pave the way for further increases in its annual dividend rate.
Utilities Continue to Share More
Due to a domestic focus, regulated operations and stable demand, utilities have a steady performance year after year, which allows them to reward shareholders through the payment of dividends, raise dividends and announce a share buyback program to increase shareholders’ net worth.
In the past few months, National Fuel Gas Company NFG, Chesapeake Utilities Corp. CPK and Consolidated Water Co. Ltd. CWCO have raised quarterly dividend rates by 4.2%, 10.3% and 11.8%, respectively.
The Zacks Consensus Estimate for National Fuel Gas’ fiscal 2023 earnings is pegged at $5.22 per share, implying 2.1% growth in the past 60 days. Its current dividend yield is 3.8%.
The Zacks Consensus Estimate for Chesapeake Utilities’ 2023 earnings is pinned at $5.16 per share, implying a year-over-year increase of 2.4%. Its current dividend yield is 2.2%.
The Zacks Consensus Estimate for Consolidated Water’s 2023 earnings is pegged at $4.79 per share, implying growth of nearly 49% in the past 60 days. Its current dividend yield is 1.16%.
Price Performance
In the last month, IDACORP’s shares have returned 1% compared with the industry’s return of 0.0%.
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Zacks Rank
IDACORP currently has a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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IDACORP, Inc. (IDA) : Free Stock Analysis Report
Chesapeake Utilities Corporation (CPK) : Free Stock Analysis Report
National Fuel Gas Company (NFG) : Free Stock Analysis Report
Consolidated Water Co. Ltd. (CWCO) : Free Stock Analysis Report
