uploads///Dividend Yield

Why Halliburton’s Dividend Yield Is Increasing

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Sep. 8 2017, Updated 8:06 a.m. ET

HAL’s dividend

On July 14, 2017, Halliburton (HAL) declared a DPS (dividend per share) of $0.18, payable in September 2017. Halliburton’s quarterly dividend has not changed for the past 12 quarters, which reflects its management’s confidence in the company’s earnings growth and balance sheet.

By comparison, Schlumberger (SLB) currently pays a $0.50 quarterly dividend per share. (Read more on SLB in Market Realist’s series Schlumberger Sees Twists and Turns before Its Recovery.)

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Halliburton’s dividend yield

Halliburton’s dividend yield, expressed as DPS relative to its share price, increased in 2Q17 over 1Q17. From 1Q17 to 2Q17, Halliburton’s stock price fell, while its DPS remained unchanged. HAL’s dividend yield thus increased from 1.46% on March 31, 2017, to 1.7% on June 30, 2017.

Halliburton’s current dividend yield is now ~1.8%, as its stock price has fallen since June 30.

Remember, dividend yield expresses shareholders’ returns by way of dividends. A dividend yield can be used to compare a stock with other stocks in the same industry.

Halliburton’s share repurchase plan

According to HAL’s share repurchase program, ~$5.7 billion remains authorized for repurchases as of June 30, 2017. Between February 2006 through June 30, 2017, HAL repurchased common stock for ~$8.4 billion.

Notably, Halliburton makes up 2.5% of the iShares US Energy ETF (IYE). Since June 30, 2017, IYE has fallen 2%, compared with the 9% fall in HAL’s stock price during the same period.

You can learn more about this industry in Market Realist’s series The Oilfield Equipment and Services Industry: A Primer.

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