Seagate (STX) Didn't 'Cut' Dividend; Seeks More Payment Normalization - RBC
- Top 10 News for 10/17 - 10/21: Merger Rumors Abound; CEOs Depart; Tesla Kicks Autopilot Up A Notch
- Wall Street ends little changed; Microsoft hits record
- AT&T (T) in Advanced Talks to Acquire Time Warner (TWX) - DJ
- Rockwell Automation (ROK) Said to Attract Takeover Interest from Schneider Electric - Source
- British American Tobacco Offers to Acquire Remaining Shares of Reynolds American (RAI) for $56.50/Share
Find out which companies are about to raise their dividend well before the news hits the Street with StreetInsider.com's Dividend Insider Elite. Sign-up for a FREE trial here.
RBC Capital is out with commentary on Seagate (Nasdaq: STX) amid the company's recent dividend announcement, suggesting to some that the company may have "cut" its payout.
Analyst Amit Daryanani commented,
On their recent EPS call STX announced the deceleration of their normal dividend and noted cash payment date would be Oct 5th. In theory, this means STX investors will not get a dividend in Sept-qtr and over 2016 they would receive 3 dividend cash payments (vs. normally 4). While implicitly this appears to be a dividend cut, our discussion with STX points towards their desire to normalize the time period from announcing their dividend to cash payment, which historically has stood around 25 days and will now be ~60 days inline with dividend paying peers. (AAPL is the only company with a sub 25 day delta between deceleration and payment). Net/Net: While in 2016 shareholders will get 3 cash dividend payments (vs. normal 4), in CY17 and beyond we expect STX to announce and payout 4 dividends suggesting this isn’t a long-term dividend cut but more a desire to adjust the timeline from deceleration to payout.
RBC rates Seagate at Sector Perform with a price target of $31.
Serious News for Serious Traders! Try StreetInsider.com Premium Free!
You May Also Be Interested In
- UPDATE: Holly Energy Partners, L.P. (HEP) Raises Quarterly Dividend 1.7% to $0.595; 7.1% Yield
- Sensient Technologies (SXT) Raises Quarterly Dividend 11.1% to $0.30; 1.7% Yield
- First Interstate BancSystem (FIBK) Declares $0.22 Quarterly Dividend; 2.8% Yield
Create E-mail Alert Related CategoriesAnalyst Comments, Dividends
Related EntitiesRBC Capital, Dividend
Sign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!