05-10-2021, 12:07 AM
(05-07-2021, 02:52 AM)fenders53 Wrote:(05-06-2021, 11:41 PM)EricL Wrote:What is your opinion on special divs? I think they are generally good as the company doesn't back themselves into a corner with a regular div that chokes them when the black clouds come for a year. Investors expect the special div every year though, or a second one two quarters later. I read that on forums all the time.A $1 special dividend is essentially a 61% dividend boost for the year on top of the 10% increase it announced last quarter.
- EOG Resources (NYSE:EOG) declares $0.4125/share quarterly dividend, in line with previous.
- Forward yield 2.15%
- The Board also declared a special dividend of $1.00/share payable along with regular dividend.
- Payable July 30; for shareholders of record July 16; ex-div July 15.
I think it's a great move by EOG management to show they are serious about shareholder returns rather than maximizing production. EOG has long been my favorite shale driller, and this shows why. They are managing cap-ex to maximize returns rather than just growing for growth's sake.
Over the last four years, they've more than doubled the dividend and cut net debt by $3 billion while growing production in a weak price environment.
At $60 WTI they will make an additional $1.9B in cash flow above this already announced special dividend, so there's more room for shareholder returns going forward. The quarterly conference call mentioned dividends 36 times, showing it is definitely a focus for management.
The transcript and slides from the quarterly conference call are worth a read if you are interested in the stock.
The market certainly responded well to the news as shares were up 8% on Friday. At $60 crude, there is still a lot of upside to go imho.