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Silgan Holdings (SLGN) Raises Quarterly Dividend by 10%

Zacks Equity Research

Silgan Holdings Inc.’s SLGN board has declared a quarterly cash dividend of 11 cents per share, showing an increase of 10% from its last payout. The raised dividend will be paid on Mar 29, 2019, to shareholders of record as on Mar 18, 2019.

Notably, the company has increased dividend for the 15th consecutive year since its initiation in 2004. In February 2018, Silgan Holdings raised its dividend by 11% to 10 cents per share.

The company reported cash and cash equivalents of $72.8 million at the end of 2018, up from $53.5 million at the end of 2017. Cash flow from operations totaled $506.5 million during the 12-month period ended Dec 31, 2018, compared with $389.7 million in the comparable period last year. The company remains focused on returning value to shareholders and paid cash dividend of $45 million in 2018.

Silgan Holdings reported fourth-quarter adjusted earnings of 38 cents per share, which improved 18.8% from the year-ago quarter. Total revenues increased 7.5% year over year to $1,071 million.

Silgan Holdings expects to deliver improved operating results across all businesses in 2019, offset by an approximately $20 million non-cash pension headwind due to significant market declines in investment values at the end of 2018. Considering these factors, the company expects adjusted earnings per share in the range of $2.10-$2.20 for 2019, reflecting a 9.6% increase from the prior year at the mid-point. The company also expects to generate cash flow of around $275 million in 2019.

Silgan Holdings provided adjusted earnings per share guidance at 40 to 45 cents for the first quarter of 2019. Compared to the earnings per share of 42 cents in the first quarter of 2018, the mid-point of the guidance reflects a year-over year improvement of 1%. However, Silgan Holdings’ results will be impacted by inflated material and freight costs.

Zacks Rank & Stocks to Consider

Silgan Holdings currently carries a Zacks Rank #3 (Hold).

A few better-ranked stocks in the Industrial Products sector are Mueller Industries, Inc. MLI, Alarm.com Holdings, Inc. ALRM and Albany International Corp. AIN, each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Mueller Industries has an expected earnings growth rate of 2.2% for 2019.

Alarm.com has an expected earnings growth rate of 7.8% for 2019.

Albany International has an expected earnings growth rate of 44.7% for 2019.

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