Alliant Energy Corporation Offers Shareholders 15 Consecutive Years of Annual Dividend Boosts (LNT)
By: Ned Piplovic,
Alliant Energy Corporation (NYSE:LNT) has been offering its investors annual dividend raises for the past 15 consecutive years and currently offers a 3.2% dividend yield.
In addition to the long streak of annual dividend hikes, the company has provided its shareholders with significant asset appreciation over the long term. Despite moderate share price volatility and overall market sell-offs in early 2018, the company still managed to hand its investors a small share price gain for the trailing 12 months. The share price lost nearly 20% between mid-November 2017 and early February 2018. However, the share price has been rising since its 52-week low in early February.
Investors convinced that the share price could continue its current uptrend in support of the company’s rising dividends should perform their own due diligence to confirm the company’s fundamentals and add this stock to their portfolio prior to the company’s next ex-dividend date. The next ex-dividend date is set for April 27, 2018, and all shareholders of record prior to that date will be eligible to receive the next dividend payout that is scheduled for distribution on the May 15, 2018, pay date.
Alliant Energy Corporation (NYSE:LNT)
Headquartered in Madison, Wisconsin, where it was founded in 1917, Alliant Energy Corporation operates as a utility holding company that provides regulated electricity and natural gas services in the Midwest region of the United States. The company operates three business segments — Electric, Gas and Other — and two subsidiaries. Through its Interstate Power and Light Company (IPL) subsidiary, Alliant Energy generates and distributes electricity, as well as distributes and transports natural gas to retail customers in Iowa. Additionally, IPL sells electricity to wholesale customers in Minnesota, Illinois and Iowa, as well as generates and distributes steam in Cedar Rapids, Iowa. Through its other subsidiary — Wisconsin Power and Light Company (WPL) — Alliant Energy Corporation provides the same electricity generation and distribution, as well as natural gas distribution and transport to retail and wholesale customers in Wisconsin. As of December 31, 2017, the Alliant Energy Corporation supplied electricity to nearly one million retail customers and natural gas to more than 400,000 retail customers.
Additionally, the company invested in various businesses that provide freight services through a short-line railway between Cedar Rapids and Iowa City, Iowa, a barge terminal and hauling services on the Mississippi River and other transfer and storage services. Furthermore, the company owns a non-regulated 347 megawatt (MW) natural-gas-fired electric generating unit near Sheboygan Falls, Wisconsin, as well as a non-regulated 99 MW wind farm in Franklin County, Iowa.
The company’s share price entered the trailing 12 months in an upward trend that started in November 2016. The share price sustained the trend with minor volatility and ascended 13.7% in seven months to reach its 52-week high of $45.18 on November 14, 2017. After the mid-November peek, the uptrend stalled for the next three weeks and then the share price plunged nearly 18% in fewer than 60 days towards its 52-week low of $37.14 on February 8, 2018.
However, after bottoming out at the beginning of February 2018, the share price embarked on another uptrend. Since the 52-week low, the share price rose nearly 12% and closed on April 19, 2018 at $41.53, which is 8% short of the November 2017 peak. However, that closing price is 4.6% higher than it was 12 months earlier, nearly 12% above the 52-week low and 60% higher than it was five years ago.
The current $0.335 quarterly payout is 6.3% higher than the $0.315 payout from the same period last year. This new quarterly dividend amount converts to a $1.34 annualized amount for 2018 and a 3.2% dividend yield, which is nearly 30% higher than the 2.5% simple average yield of all the companies in the Utilities sector.
The company has been paying dividends since 1946 and was on a recent rising streak when that streak of rising annual dividends stalled in 1999. The company paid a flat $1.00 annual dividend every year from 1999 through 2002 and then cut its annual dividend in half for 2002. However, the company resumed raising its dividends the following year and has not missed an annual dividend hike since then. Over the past 15 consecutive years, the company grew its annual dividend payout at an average rate of 6.8% per year. That rate resulted in the 168% rise of the annual dividend amount from $0.50 in 2003 to the current $1.34 payout amount.
The combination of steady dividend growth and small asset appreciation rewarded the company’s shareholders with a total return of nearly 7% over the past 12 months. However, the longer-term total returns over the past three and five years were more positive at 46.5% and 85%, respectively.
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Ned Piplovic is the assistant editor of website content at Eagle Financial Publications. He graduated from Columbia University with a Bachelor’s degree in Economics and Philosophy. Prior to joining Eagle, Ned spent 15 years in corporate operations and financial management. Ned writes for www.DividendInvestor.com and www.StockInvestor.com.