Verizon Boosts Annual Dividend 14 Consecutive Years (VZ)
By: Ned Piplovic,
Verizon Communications, Inc. (NYSE:VZ) has hiked its total annual dividend amount for the 14th consecutive year and currently offers a 4.5% dividend yield.
The company’s current yield is close to the telecommunications segment’s average yield but more than double the average yield of the total Technology sector. The company’s share price originally lost almost 20% through the middle of July 2017, but has recovered completely and had a significant surge over the past 30 days.
The company’s next ex-dividend date is set for January 9, 2018, and the pay date will follow just a few weeks later on February 1, 2018.
Verizon Communications, Inc. (NYSE:VZ)
Founded in 1983 and headquartered in New York City, Verizon Communications Inc. provides communications, information and entertainment products and services. The company offers wireless voice and data services, internet access on various smart and basic phones, notebook computers and tablets. Additionally, Verizon offers Internet of Things (IoT) services that support devices used in fleet management and telematics, energy and agricultural technology, as well as smart community markets and wireless devices.
The company’s Wireline segment offers high-speed internet, Fios internet, Fios video services and Voice over Internet Protocol (VoIP) telephone service. As of November 2017, 98% of the U.S. population had coverage of Verizon’s 4G LTE network. Additionally, Verizon is developing the next generation network and will launch its first 5G network in Sacramento, California, in the second half of 2018. The 5G network technology provides connection speeds that are 30 to 50 times faster than the current 4G technology. Formerly known as Bell Atlantic Corporation, the company changed its name to Verizon Communications Inc. in June 2000.
The company’s current $0.59 quarterly dividend distribution is 2.2% higher than it was in the same period of the previous year. Additionally, the current quarterly payout is equivalent to a $2.36 annualized distribution and a 4.5% dividend yield. While the company’s current yield is within 6% of the average dividend yield of the Telecom Services segment, it is 260% higher than the 1.24% average yield of the entire Technology sector.
Verizon Communications has been distributing dividends to its shareholders since 1984 and has raised its annual payout amount for the last 14 consecutive years. Since 2005, the company boosted its annual dividend distribution by an average growth rate of 3.1% per year. The company has enhanced its annual dividend by 53%, since starting the current rising dividend streak in 2005.
The company’s share price struggled for more than half of the current trailing 12-month period before showing positive signs and trending up in the later part of the year. The first two weeks of the trailing 12-month period looked promising, as the share price rose 3.2% from $52.97 on December 20, 2016, to $54.64 on January 5, 2017. Unfortunately, the January 5, 2017, closing price turned out to be the highest share price for the current 52-week period. After the early January peak, the share price dropped 27.4% over the following six months and closed at its 52-week low of $42.89 on July 11, 2017.
The share price showed signs of life when it grew 14% by October 4, 2017, only to drop 11.6% immediately to $44.11 by November 15, 2017, which was just 2.4% above the 52-week low from July 2017. However, after the most recent dip in November, the share price ascended 19.6%, recovered all the loses since December 2016 and closed on December 20, 2017, at $52.77, which is virtually even with the share price from one year ago, just 3.4% below the January 2017 52-week high and 23% higher than the 52-week low from July 2017.
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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.