Business & Finance
Business and Finance
Business and Finance
Tue, December 14, 2010
Mon, December 13, 2010 Edison International, Sempra Energy, Enersis S.A., Airgas and Air Products & Chemicals
CHICAGO--([ BUSINESS WIRE ])--Zacks.com Analyst Blog features: Edison International (NYSE: [ EIX ]), Sempra Energy (NYSE: [ SRE ]), Enersis S.A. (NYSE: [ ENI ]), Airgas Inc. (NYSE:[ ARG ]) and Air Products & Chemicals Inc. (NYSE: [ APD ]).
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Here are highlights from Fridaya™s Analyst Blog:
Edison Ups Quarterly Dividend
Electric utility, Edison International (NYSE: [ EIX ]) boosted its quarterly dividend to 32 cents per share. The company will now pay an annual dividend of $1.28 per share compared to $1.26 previously. This move lifts the companya™s dividend 1.6% over last yeara™s dividend.
Edison International said that the dividend will be paid on January 31, 2011 to share holders of record as of December 31, 2010.
The board of directors of Edison said the modest increase in the dividend balances the substantial and growing capital needs at its utility business, Southern California Edison (SCE). Going forward, the company plans to pay out roughly 45%-55% of SCEa™s earnings as dividend to its shareholders.
Nonetheless, management expects to fall short of the targeted payout range due to the projected capital spending program at SCE.
Edisona™s annualized dividend yield of 3.37% is higher than its peers, Sempra Energy (NYSE: [ SRE ]) and Enersis S.A. (NYSE: [ ENI ]), with respective dividend yields of 3.04% and 1.81%.
Edison has a history of consistently increasing dividends for its shareholders. The company has consistently increased dividend payout from 85 cents in 2004 to $1.28 this year. This illustrates the companya™s commitment to provide returns to shareholders, enhancing shareholder value.
We note that Edisona™s strong balance sheet and cash flow position support its strategy of raising dividends. The company ended the September quarter with cash and cash equivalents of $2 billion and operating cash flow $2.8 billion at the end of the nine month period.
Is Airgas Deal in Final Stages?
The year-long tussle between Airgas Inc. (NYSE:[ ARG ]) and Air Products & Chemicals Inc. (NYSE: [ APD ]) might reach an end as Airgasa™ board of directors reviews Air Productsa™ raised and final offer of $70 per share from the previous bid of $65.50 per share. Airgas shares fell 6% to $61.84 on the news apprehending that Air Products will walk away if spurned again.
The $70 per share offer is at a 61% premium to Airgasa™ closing price of $43.53 as of February 4, 2010, the day before Air Products first announced an offer to acquire Airgas. The revised offer will expire on January 14, 2011. At the current offer of $70 per share, the deal is valued at $5.9 billion excluding debt.
The Airgas-Air Product conflict began in October 2009 when Air Products made an all-stock proposal offer at an implied value of $60 per share. After being rejected, Air Products upped its offer to a cash and stock proposal with an implied value of $62 per share in December 2009. On February 5, 2010, Air Products made an unsolicited public offer of $60 per share in cash. On rejection, Air Products continued its efforts to woo Airgas, increasing its offer to $63.50 in July and then to $65.50 in September.
Airgasa™ board had continuously rejected all the offers on the premise that they highly undervalue the company and its future prospects, including its industry leading position in the packaged gas business, unrivaled platform and benefits expected from the substantial recent investments.
The Airgas board recently stated that the then standing offer of $65.50 was no where near the right price for its sale. Airgas estimated that its value substantially exceeded $70 per share and stated its willingness to negotiate with Air Products if offered the right price.
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