Given the potential significant increases in tax rates on dividends beginning next year, and their strong levels of capital, it is an opportune time for many companies to provide special dividend distributions to their shareholders before the end of the year. While most companies are sitting on higher levels of cash than in years past, it is becoming the common thing to pass more dividends to their shareholders before yearend. Here is a list of notable special dividends being offered to shareholders over the past week.
On October 30, 2012, Select Medical (NYSE: SEM)‘s board of directors declared a special cash dividend of $1.50 per share, totaling approximately $210.8 million. This special cash dividend will be paid on or about December 12, 2012 to all stockholders of record at the close of business on December 5, 2012. The special dividend has a current yield of 13%.
“The dividend allows us to return capital to stockholders without diminishing our ability to pursue investment and acquisition opportunities,” stated Robert A. Ortenzio, Select Medical’s Chief Executive Officer. The dividend is expected to be funded with cash on hand and borrowings under Select Medical’s existing revolving credit facility. Select Medical (SEM) anticipates using approximately $100.0 million of available cash on hand toward the funding of the dividend. Select Medical’s leverage ratio (total debt to Adjusted EBITDA) at September 30, 2012 was 3.35, compared to 3.62 at December 31, 2011.
Select Medical has an equity summary score of 9.6 out of 10 for a VERY BULLISH outlook.
Sinclair Broadcast Group, Inc. (NASDAQ: SBGI) says its board has declared a special cash dividend of $1.00 per share and a quarterly cash dividend of $0.15 per share on the company’s Class A and Class B common stock. The dividends are payable on December 14, 2012, to the holders of record at the close of business on November 30, 2012.
The combined dividend is a yield of 9.25%. Sinclair Broadcast has an equity summary score of 9.9 out of 10 for a VERY BULLISH outlook.
Commerce Bancshares, Inc. (NASDAQ: CBSH) announced that its Board of Directors approved a 5% stock dividend payable on December 17, 2012 to shareholders of record at the close of business on November 30, 2012. Commerce Bancshares closed at $38.38. This makes the 5% stock dividend worth $1.92 in current stock value.
For beginners, Commerce Bancshares is offering .05 shares of stock for each 1 share owned by the investor (this excludes fractional shares). For example, an investor holding 100 shares of CBSH will receive an additional 5 shares for their 5% stock dividend.
Also the Board of Directors approved a regular quarterly dividend of $0.23 per share on the company’s common stock and also authorized a special cash dividend of $1.50 per share. This is a combined cash yield of 4.51% for the special and regular dividends.
Both dividend payments will be payable December 17 to stockholders of record at the close of business on November 30, 2012. The dividend will not be payable on any shares to be issued pursuant to the 5% stock dividend also declared on this date.
Commerce Bancshares has an equity summary score of 7.6 out of 10 for a BULLISH outlook.
HollyFrontier Corp.’s (NYSE: HFC) Board of Directors approved a 33% increase in its regular quarterly cash dividend to $0.20 per share from the current rate of $0.15 per share. The regular dividend will be paid on December 21, 2012 to holders of record of common stock on December 10, 2012.
The company also announced today a special cash dividend in the amount of $0.50 per share. The special dividend will be paid on November 30, 2012 to holders of record of common stock on November 15, 2012.
HFC is trading at $37.72 making the combined dividend payout with a yield of 1.86%. HollyFrontier Corp has an equity summary score of 9.7 out of 10 for a VERY BULLISH outlook.
Masimo (NASDAQ: MASI) announced that its Board of Directors has declared a special cash dividend of $1.00 per share, payable onDecember 11, 2012 to stockholders of record as of the close of business on November 27, 2012. The special dividend is a yield of 4.5%.
The payout for the special $1.00 per share cash dividend announced today is expected to be about $57.2 million, based on the current shares outstanding, and will be reflected in the company’s fourth quarter and full year 2012 financial statements. The special dividend payout represents only a portion of the company’s cash reserves, which the Board believes is sufficient to cover operational needs, and fund continued research and development investments and strategic initiatives.
Masimo has an equity summary score of 6.9 out of 10 for a NEUTRAL outlook.
Astec Industries, Inc. (NASDAQ: ASTE) announced that the Board of Directors declared a special one-time dividend of $1.00 per share to be paid on December 12, 2012 to shareholders of record as of November 20, 2012. The special dividend is a yield of 11.1%. Astec Industries has an equity summary score of 2.6 out of 10 for a BEARISH outlook.
Commenting on the declaration of the Astec dividend, Dr. Brock said, “We have maintained a strong balance sheet for several years but have not found the right acquisitions in which to invest our excess cash. While acquisitions are still a high priority for us, the Board of Directors decided to declare a special one-time dividend as a tangible return of value to our shareholders while the tax rates are still advantageous.”
On November 1, 2012 the board of directors at Universal American Corp (NYSE: UAM) approved a dividend of 1.00 per share. The dividend is payable on November 19, 2012 to shareholders of record on November 12, 2012. The special dividend is a yield of 11.1%. Universal American has an equity summary score of 2.6 out of 10 for a BEARISH outlook.
The Board of Directors of RGC Resources, Inc. (NASDAQ: RGCO) declared a special dividend of$1.00 per share on the Company’s common stock. The dividend will be paid on December 17, 2012 to shareholders of record on November 30, 2012. The special dividend is a yield of 5.5%. RGC Resources has an equity summary score of 1.9 out of 10 for a BEARISH outlook.