United Parcel Service: Q2 2018 dividend
On May 10, United Parcel Service (UPS) announced its regular quarterly dividend of $0.91 per share. In the first quarter, UPS raised its quarterly dividend per share by 10.0% from $0.83 paid in the previous quarter.
UPS expects to pay a quarterly dividend of $0.91 per share on all outstanding Class A and Class B shares. The quarterly cash dividend is payable on June 6 to stockholders of record on May 21. The dividend payment of $0.91 per share equals a cash outlay of ~$755.0 million in the second quarter.
United Parcel Service’s historical dividends and growth
United Parcel Service has a history of rewarding stockholders with generous cash dividends and successive annual dividend increases. The company has paid either stock or cash dividends annually since 1955. UPS has more than quadrupled its dividend since December 1999.
The chart above reveals that UPS has consistently raised its dividend per share year-over-year in the last 17 years. The current dividend of $0.91 per share marks a 10.0% rise in yearly dividends since 2012. In that year, UPS raised its quarterly cash dividend by 10.0%. United Parcel Service’s compound annual growth rate is expected to be 8.1% in the nine years ending December 2018.
Peer group’s dividend growth
United Parcel Service’s (UPS) primary competitor, FedEx (FDX), has maintained a quarterly cash dividend of $0.50 per share in the last four quarters. With the benefits flowing in from the Tax Cuts and Jobs Act, FedEx is expected to increase its dividends in the coming quarter. FDX follows a fiscal year that ends in May.
In the third quarter of 2017, US third-party logistics firm C.H. Robinson Worldwide (CHRW) raised its quarterly per share dividend from $0.45 to $0.46 in the fourth quarter of 2017. ArcBest (ARCB) has paid a quarterly dividend of $0.08 per share for the last 11 quarters.
In the first quarter, transportation technology leader J.B. Hunt Transport Services (JBHT) raised its quarterly dividend 4.3% to $0.24 per share from $0.23 per share in the previous quarter.
We’ll take a look at UPS’s free cash flows in the next article.