W.R. Grace raises its dividend
W.R. Grace (GRA) announced that its board of directors approved a 14.0% increase in its regular annual cash dividend. In 2018, GRA expects to pay a cash dividend of $0.96 per share, an increase of 14.3% over 2017.
In 2017, GRA paid a cash dividend of $0.84 per share, which would be effective in 1Q18. GRA declared a dividend of $0.24 per share for 1Q18. Shareholders as of March 1, 2018, would receive this dividend, which is expected to be paid on March 22, 2018.
The increase in the dividend and the fall in the stock price has helped improve GRA’s current dividend yield. On February 9, 2018, GRA’s current dividend yield stood at 1.48%.
GRA’s peers Albemarle (ALB), FMC (FMC), and LyondellBasell (LYB) have current dividend yields of 1.2%, 0.80%, and 3.4%, respectively. GRA’s current dividend yield is also lower than the yield generated from the one-year Treasuries. Its current yield makes it a difficult option for the long-term investors who focus on dividend income.
Stock price update
W.R. Grace (GRA) stock price fell 10.0% and closed at $64.84 for the week ended February 9, 2018. The decline in its stock price resulted in GRA trading 10.50% below its 100-day moving average price of $72.43, indicating weakness in the stock.
However, GRA’s 14-day relative strength index of 25 indicates that the stock temporarily moved into an oversold position.
Analysts have projected GRA’sts target price to be $85.00, which implies a return potential of 31.1% over its February 9, 2018, closing price.
Investors can gain broad-based exposure to GRA via the iShares US Basic Materials ETF (IYM). IYM invested 0.60% of its portfolio in W.R. Grace on February 9, 2018.