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Infrastructure

AT&T Dividend Declaration, Prelude to Hike Right Before Year-End

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By Jon C. Ogg Updated Published
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AT&T Inc. (NYSE: T) has just initiated its fourth payment of a $0.44 per common share quarterly dividend. We were not expecting a dividend hike this month, but we are formally setting December for the next dividend hike now.

Verizon Communications Inc. (NYSE: VZ) has raised its dividend in the last month with a declaration date of September 6. That was a 3% raise to $0.515 from $0.50 per common share per quarter.

If we our expectations pan out on the coming AT&T hike in December then realistically that payout will rise to $0.45 or $0.455 per common share per quarter. AT&T has lifted its dividend by 1 penny per quarter once a year for each of the past four years.

With a Thomson Reuters consensus earnings estimate of $2.57 EPS for 2013, AT&T’s payout ratio would be about 70% if the hike just goes up to $0.45 from $0.44. That is a high payout ratio, but it is not as if AT&T has to save all of its cash for endless acquisitions at this point even if it wants to (and needs to) buy more wireless spectrum.

JON C. OGG

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About the Author Jon C. Ogg →

Jon Ogg has been a financial news analyst since 1997. Mr. Ogg set up one of the first audio squawk box services for traders called TTN, which he sold in 2003. He has previously worked as a licensed broker to some of the top U.S. and E.U. financial institutions, managed capital, and has raised private capital at the seed and venture stage. He has lived in Copenhagen, Denmark, as well as New York and Chicago, and he now lives in Houston, Texas. Jon received a Bachelor of Business Administration in finance at University of Houston in 1992. www.247wallst.com.

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