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%
Buffett has announced plans to step down as Berkshire Hathaway chief executive by the end of the year after a storied 60-year run. —WSJ
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).
Buffett has announced plans to step down as Berkshire Hathaway chief executive by the end of the year after a storied 60-year run. —WSJ
