Fortis (NYSE:FTS) Increases Dividend to C$0.67 Per Share

Key Points

• Fortis raised its quarterly dividend 3.9% to C$0.67 per share, payable December 1 to shareholders of record November 17; the indicated yield is 4.5%.
• The dividend appears well covered: its payout ratio is 71.1%, and analysts project a 66.4% ratio next year based on expected earnings and dividends.
• Fortis reported quarterly EPS of C$0.66, beating the consensus estimate of C$0.63 by C$0.03.

Fortis (NYSE:FTS - Get Free Report) declared a quarterly dividend on Tuesday, November 3rd. Investors of record on Tuesday, November 17th will be paid a dividend of C$0.67 per share by the utilities provider on Tuesday, December 1st. This represents a $2.66 annualized dividend and a yield of 4.5%. The ex-dividend date is Tuesday, November 17th. This is a 3.9% increase from Fortis's previous quarterly dividend of C$0.64.

Fortis has decreased its dividend by an average of 0.1% annually over the last three years and has increased its dividend annually for the last 5 consecutive years. Fortis has a dividend payout ratio of 71.1% meaning its dividend is sufficiently covered by earnings. Equities analysts expect Fortis to earn $2.74 per share next year, which means the company should continue to be able to cover its $1.82 annual dividend with an expected future payout ratio of 66.4%.

Fortis Price Performance

FTS stock traded up $0.40 during trading hours on Tuesday, hitting $59.69. 1,542,719 shares of the stock traded hands, compared to its average volume of 838,012. The stock has a 50-day simple moving average of $54.83 and a 200 day simple moving average of $55.90. The company has a market cap of $30.79 billion, a P/E ratio of 24.16 and a beta of 0.42. Fortis has a one year low of $49.60 and a one year high of $60.19. The company has a current ratio of 0.56, a quick ratio of 0.47 and a debt-to-equity ratio of 1.27.

Fortis (NYSE:FTS - Get Free Report) last issued its quarterly earnings results on Tuesday, November 3rd. The utilities provider reported $0.66 EPS for the quarter, topping the consensus estimate of $0.63 by $0.03. Fortis had a net margin of 14.17% and a return on equity of 7.16%. Equities analysts forecast that Fortis will post 2.57 earnings per share for the current year.

Hedge Funds Weigh In On Fortis

A number of hedge funds have recently added to or reduced their stakes in FTS. Cibc World Market Inc. acquired a new position in Fortis during the second quarter worth about $442,633,000. Legal & General Group Plc bought a new position in shares of Fortis in the second quarter worth about $334,727,000. Connor Clark & Lunn Investment Management Ltd. acquired a new stake in shares of Fortis in the 2nd quarter valued at approximately $311,146,000. Bank of Nova Scotia acquired a new stake in shares of Fortis in the 2nd quarter valued at approximately $257,370,000. Finally, Canada Pension Plan Investment Board acquired a new stake in shares of Fortis in the 2nd quarter valued at approximately $177,656,000. Institutional investors and hedge funds own 57.77% of the company's stock.

About Fortis

Fortis Inc is a Canadian utility holding company that owns and operates regulated electric and natural gas utilities. Its businesses are primarily focused on the transmission and distribution of electricity, natural gas distribution, and related energy infrastructure.

Through its portfolio of utility subsidiaries, Fortis serves customers across Canada and the United States, with additional operations in the Caribbean. Its businesses include electric utilities, natural gas utilities, and electric transmission assets, providing essential energy services to residential, commercial, and industrial customers.

Fortis has expanded from its Canadian utility origins through acquisitions and investments in regulated infrastructure.

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