Regal Beloit Hikes Dividend - Analyst Blog

Industrial electrical equipment maker Regal Beloit Corporation RBC recently announced a 10% year-over-year hike in its dividend payout to a quarterly payment of 22 cents or 88 cents per share on an annualized basis. The increased cash dividend is payable on Jul 11 to shareholders of record as of Jun 27.

Based on the closing price of $73.03 on Apr 28, 2014, the proposed dividend affirms a yield of 1.2% and marks the 216th consecutive quarterly cash dividend payment by the company. A steady dividend payout is part of the long-term strategy of Regal Beloit to provide attractive risk-adjusted returns to its stockholders. In addition, decent dividend increases at periodic intervals have been one of the company's most attractive features.

Regal Beloit had earlier raised the quarterly dividend payout by a penny each in the last four years. Over the last decade, the company has returned more than $220 million to its shareholders through regular quarterly dividends and has increased the payout each year except 2009. The company remains confident of generating strong operating cash flow to fund its organic and inorganic growth as well as to return significant capital to shareholders.

Regal Beloit is scheduled to report its first quarter 2014 results after the closing bell on May 5. The current Zacks Consensus Estimate for the quarter is pegged at $1.04. Earnings estimates are moving up for Regal Beloit and we remain bullish on a likely earnings beat in this quarter.

Headquartered in Beloit, WI, Regal Beloit is a leading manufacturer of electrical and mechanical motion control products. Major products include electric motors, HVAC electric motors, electric generators and controls, and mechanical motion control products. The products are offered to diversified end markets such as commercial construction and building, industrial machinery, industrial equipment, process industries, industrial transportation, and consumer related segments. The company has manufacturing, sales, and service facilities throughout the U.S., Canada, Mexico, Europe, and Asia.

Regal Beloit currently has a Zacks Rank #3 (Hold). Other players in the industry worth mentioning include Plug Power Inc. PLUG, AO Smith Corp. AOS and AVT, Inc. (AVTC), each carrying a Zacks Rank #2 (Buy).