Business

BB&T, Duke boost dividends

Against the financial tide, BB&T and Duke Energy announced quarterly dividend increases Tuesday of a penny each.

Those N.C.-based Fortune 500 companies are bucking a national trend of companies lowering and even dropping their dividends to save money in tough times. Instead, the companies are willing to boost dividend spending to impress investors in hopes of increasing their stock prices.

They join home improvement giant Lowe's, which increased its dividend by more than 6 percent last month as investors deal with a wounded stock price and a third straight quarter of falling profit.

The number of S&P 500 companies raising their dividends in January fell 12 percent compared with the same month last year. And the number of declaring any kind of dividend in January, the latest figures available, was down 3.4 percent over the same month last year, according to Standard & Poor's.

That contrasts to a 5 percent increase for January of last year and three straight years of increases.

A healthy dividend can make a stock more attractive and ultimately push the share price higher, analysts say. Some investors are attracted to stocks with dividends because they pay out without having to sell the stock.

In fact, rumors Thursday that BB&T might slash its payment sent the stock reeling 12 percent before it recovered the same day on company assurances the payment would go up.

In contrast, directors at Wachovia and Fifth Third Bancorp, which took over First Charter and now has a strong retail presence in Charlotte, shrank payments recently to save money during a national mortgage crisis.

Some of the bigger companies in the state that have recently boosted their dividends include:

Winston-Salem-based BB&T. North Carolina's third-largest bank increased its quarterly dividend Tuesday to 47 cents per share.

Chief executive John Allison said the more than 2 percent increase shows the bank's “healthy capital levels.” The stock has fallen about 40 percent in the past year. With its dividend factored in, the total return was down 36.5 percent, according to Bloomberg.

Lowe's. The nation's second-largest home improvement chain, raised its dividend to 8.5 cents from 8 cents. The Mooresville-based retailer has also suffered from the housing downturn. Its stock price has fallen more than 29 percent in the last year (-28.5 with dividend).

Duke. The Charlotte-based utility raised its quarterly dividend Tuesday to 23 cents a share. Duke also bumped it a penny last June as part of a general goal of increasing it each year, said spokesman Tom Shiel.

The utility's stock price is down 3.7 percent in the past year. With the dividend, the total return was in positive territory, up nearly 1 percent.

Piedmont Natural Gas. The Charlotte-based utility increased its dividend by a penny to 26 cents per share at the end of March. Piedmont's stock price is up 8 percent in the last year (12.2 percent with the dividend).

Against the financial tide, BB&T and Duke Energy announced quarterly dividend increases Tuesday of a penny each.

Those N.C.-based Fortune 500 companies are bucking a national trend of companies lowering and even dropping their dividends to save money in tough times. Instead, the companies are willing to boost dividend spending to impress investors in hopes of increasing their stock prices.

They join home improvement giant Lowe's, which increased its dividend by more than 6 percent last month as investors deal with a wounded stock price and a third straight quarter of falling profit.

The number of S&P 500 companies raising their dividends in January fell 12 percent compared with the same month last year. And the number of declaring any kind of dividend in January, the latest figures available, was down 3.4 percent over the same month last year, according to Standard & Poor's.

That contrasts to a 5 percent increase for January of last year and three straight years of increases.

A healthy dividend can make a stock more attractive and ultimately push the share price higher, analysts say. Some investors are attracted to stocks with dividends because they pay out without having to sell the stock.

In fact, rumors Thursday that BB&T might slash its payment sent the stock reeling 12 percent before it recovered the same day on company assurances the payment would go up.

In contrast, directors at Wachovia and Fifth Third Bancorp, which took over First Charter and now has a strong retail presence in Charlotte, shrank payments recently to save money during a national mortgage crisis.

Some of the bigger companies in the state that have recently boosted their dividends include:

Winston-Salem-based BB&T. North Carolina's third-largest bank increased its quarterly dividend Tuesday to 47 cents per share.

Chief executive John Allison said the more than 2 percent increase shows the bank's “healthy capital levels.” The stock has fallen about 40 percent in the past year. With its dividend factored in, the total return was down 36.5 percent, according to Bloomberg.

Lowe's. The nation's second-largest home improvement chain, raised its dividend to 8.5 cents from 8 cents. The Mooresville-based retailer has also suffered from the housing downturn. Its stock price has fallen more than 29 percent in the last year (-28.5 with dividend).

Duke. The Charlotte-based utility raised its quarterly dividend Tuesday to 23 cents a share. Duke also bumped it a penny last June as part of a general goal of increasing it each year, said spokesman Tom Shiel.

The utility's stock price is down 3.7 percent in the past year. With the dividend, the total return was in positive territory, up nearly 1 percent.

Piedmont Natural Gas. The Charlotte-based utility increased its dividend by a penny to 26 cents per share at the end of March. Piedmont's stock price is up 8 percent in the last year (12.2 percent with the dividend).

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