CVS Treats Shareholders With Dividend Hikes, Stock Buybacks
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It currently yields a solid 1.5%. Valuation looks reasonable too, with shares trading at just 13.2x forward earnings, below the industry median.
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CVS generates strong free cash flow and has been using this cash to reward shareholders. In the first 9 months of 2011, the company returned more than $3 billion to shareholders through dividends and share buybacks.
CVS also said it will buy back around $3 billion in stock in 2012. Management also recently raised its quarterly dividend by 30 percent. It plans to raise its dividend around 25% per year through 2015.
Since 2000, CVS has raised its dividend at an average annual rate of 15%
What made you decide to buy CVS in the first place?
Just curious.
It's been a while but I'm pretty sure I picked it up during a price drop, thinking that I didn't have many stocks in its sector.
(Not only is my vp mostly stocks, but it's not well diversified. Too much oil and tobacco).
