Will Other Integrated Oils Hike Dividends Too? (COP, XOM, CVX, BP)

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ConocoPhillips (NYSE: COP) hiked its dividend Friday, and not just by a penny.  Its quarterly dividend was raised from $0.41 per quarter up to $0.47 per quarter.  ConocoPhillips hiked its dividend a year or so from $0.36 to $0.41.  At current prices around $78.50, the prior annualized dividend of $1.64 would yield of 2.08%.  But the new annualized dividend of $1.88 is now running almost 2.4%. 

Frankly, for companies involved in perhaps the best business around right now, the oil giants in the sector are paying quite lower dividends than one might imagine.

  • Exxon Mobil Corp. (NYSE: XOM) has a $0.35 dividend, or $1.40 annualized, and at $85.00 it has an implied yield of just under 1.65%.
  • Chevron Corp. (NYSE: CVX) has a $0.58 quarterly dividend, or $2.32 annualized, and at $83.00, this represents nearly a 2.8% dividend yield.

The standout is BP plc (NYSE: BP) although it is more thinly traded; it actually has a quite high dividend.  CORRECTION: Its dividend was recently bumped and is $0.8115 now rather than $0.65, so the actual yield is roughly 4.9% and even much higher than most oil dividends….CORRECTION FROM Its $0.65 quarterly dividend, or $2.60 annualized, generates just under a 4% dividend yield based on a $65.50 ADR price.  Dividend may fluctuate from dollar conversions

When you compare most of these dividends to the Dogs of the Dow, there is still quite a bit of room for dividend improvement.  At least that is how investors used to judge stocks once upon a time.

Jon C. Ogg
February 15, 2008