Steel manufacturer Steel Dynamics, Inc. (NASDAQ: STLD) recently announced a quarterly dividend of $0.34 per share, up 31% from the previous dividend of $0.26.
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Following the news, shares of the company rose 1.9% to close at $71.90 in Monday’s extended trading session.
The dividend will be paid on March 31, 2022, to shareholders of record as of April 15, 2022.
Notably, the company has been raising its dividend consistently over the past ten years, making it an attractive choice for investors.
Share Repurchase
The company also announced that its Board has authorized an additional share repurchase program of up to $1.25 billion of the company’s common stock.
The buyback is in addition to a previously announced share repurchase program of $1 billion that was authorized on July 6, 2021.
Management’s Take
The CEO of Steel Dynamics, Mark D. Millett, said, “These actions reflect the Board’s and senior leadership’s confidence in the consistency and strength of our cash generation capabilities. We have consistently grown our cash dividends to shareholders in alignment with our structural growth initiatives, maintaining a positive cash dividend growth profile. Additionally, as a complement to our dividend, we have actively utilized our share repurchase programs in periods of exceptionally strong cash generation.”
Stock Rating
Recently, Goldman Sachs analyst Emily Chieng reiterated a Buy rating on the stock. The analyst, however, raised the price target from $75 to $80, which implies upside potential of 13.4% from current levels.
Consensus among analysts is a Moderate Buy based on 3 Buys, 1 Hold and 1 Sell. The average Steel Dynamics stock prediction of $70.20 implies 0.54% downside potential from current levels. Shares have gained 60.4% over the past year.
Hedge Funds’ Confidence
TipRanks’ Hedge Fund Trading Activity tool shows that hedge fund confidence in Steel Dynamics is currently Very Positive. Moreover, the cumulative change in holdings across all eight hedge funds that were active in the last quarter was an increase of 259,200 shares.
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