Caterpillar Inc. (NYSE: CAT), today, announced that its Board of Directors approved a 13% dividend increase. Despite the dividend hike, CAT shares are down in trading today.
Caterpillar’s Board voted to raise the quarterly cash dividend by $0.06 to $0.52 per share. The dividend will be payable on August 20, 2012 to shareholders of record at close of business on July 20, 2012.
The dividend increase is the biggest since the August 2008 when the quarterly dividend was raised by 16.7%.
Doug Oberhelman, Chairman and CEO of Caterpillar, said that as part of the company’s strategy, over the business cycle, it aims to deliver total stockholder return in the upper 25% of the S&P 500 and the 13% increase represents the company’s continued commitment to providing value to stockholders.
Oberhelman said that further demonstrating the track record of rewarding stockholders over the years, CAT has paid higher dividends to stockholders for 19 years in a row, and during the last 10 years, the company’s total stockholder return has been 322%, which is in the top 25% of the S&P 500. Oberhelman added that CAT believes dividend payments are a good way to reward long-term investors in the company.
Despite the dividend hike, CAT shares fell in trading today. At last check, the stock was trading 2.17% lower at $85.16 on volume of 7.08 million.
CAT shares have fallen 6.29% this year, compared with a gain of 4.44% for the S&P 500.
Caterpillar is engaged in the manufacturing of construction and mining equipment, diesel and natural gas engines, industrial gas turbines and diesel-electronic locomotives. The company is based in Peoria, Illinois.
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