Boeing declared dividend
Boeing (BA) has been focused on enhancing shareholders’ returns through regular dividend payments and dividend hikes. On June 25, the company declared a quarterly dividend of $2.055 per share to be payable on September 6 to shareholders on record as of August 9.
Boeing has been paying regular quarterly dividends for the past 80 years. For the last seven years, the company has raised dividends once every four quarters. Boeing raised its quarterly dividend by 20% in February to $2.055 from $1.71. The company’s quarterly dividend rate has grown ~389% between 2012 and 2018.
In 2018, Boeing paid $3.95 billion in dividends, which was over three times higher than the $1.26 billion it spent in 2011. In the first quarter of 2019, it returned $1.16 billion to shareholders in dividend payouts.
Dividend yield and payout ratio
Boeing has an impressive dividend yield that’s higher than the industry average and almost at par with top peers in the aerospace and defense space. The company’s dividend yield of 2.2% is significantly higher than the aerospace and defense sector average yield of 1.3%. Lockheed Martin (LMT) has the highest dividend yield in the sector of 2.4%. Other peers United Technologies (UTX) and General Dynamics (GD) have yields of 2.3% each.
Boeing’s dividend payout ratio is the second-highest in the Aerospace & Defense sector after Lockheed Martin. Lockheed Martin has a dividend payout ratio of 43.1%, while Boeing distributes 40.5% of its earnings. United Technologies and General Dynamics have payout ratios of 37.3% and 33.8%, respectively.
The iShares U.S. Aerospace & Defense ETF (ITA) invests in manufacturers, assemblers, and distributors of aircraft and defense equipment. With 23.5% returns, the ETF has made a remarkable run this year so far. It also outpaced the gains of the Dow Jones Index, which is up 13.8%.