Johnson Controls Hikes Quarterly Dividend by 2.9%; Shares Gain 4.4%

In line with its policy to boost shareholders’ value, Johnson Controls International plc (NYSE: JCI) has increased its quarterly dividend by 2.9%. It started paying dividends in 1887.

The quarterly reward seems to have made investors happy, as the company’s stock rose 4.4% on Wednesday, closing the trading session at $62.81.

The company manufactures building products and systems. Its offerings include fire-detection systems, industrial refrigeration systems, and heating, ventilating, and air-conditioning (HVAC) products for commercial and residential use. The company is headquartered in Cork, Ireland.

Inside the Headlines

The increase of $0.01 per share or 2.9% in the dividend rate was approved by the board of directors of Johnson Controls. The new dividend rate now stands at $0.35 per share, up from $0.34 per share distributed previously.

The revised quarterly dividend will be paid on April 14 to all shareholders who will be in the company’s records as of March 21.

Snapshot of Johnson Controls’ Shareholders-Friendly Policy

The company has a record of rewarding its shareholders handsomely with dividend payments. In Fiscal Year 2021 (ended September 30, 2021), the company’s dividend disbursement totaled $762 million, while the same was $191 million in the first quarter of the Fiscal Year 2022 (ended December 31, 2021).

Interestingly, the company raised its quarterly dividend by 26% (or $0.07 per share) to $0.34 per share in December 2021. JCI believes that its dividend payments are contingent upon its financial conditions and capital requirements.

For the Fiscal Year 2022, the company anticipates earnings per share (before special items) to be within the $3.22-$3.32 range. The projection reflects year-over-year growth of 22%-25%. Earnings in the second quarter are predicted to be $0.62-$0.64, up 19-23% year-over-year.

In addition to dividend payouts, the company rewards shareholders by buying back its shares. The company bought back shares worth $1.31 billion in the Fiscal Year 2021 and $526 million in the first quarter of the Fiscal Year 2022.

Exiting the first quarter, the company was left to repurchase shares worth $4.5 billion under its authorized programs.

Wall Street’s Take

Recently, Joshua Pokrzywinski, an analyst at Morgan Stanley reiterated a Buy rating on Johnson Controls and lowered the price target to $84 (33.74% upside potential) from $92.

Johnson Controls has a Moderate Buy consensus rating, indicating Wall Street’s cautiously optimistic view on the stock. The consensus rating is based on 9 Buys and 4 Holds. Also, the average Johnson Controls price target of $84.08 suggests 33.86% upside potential from current levels. Over the past year, shares of Johnson Controls have gained 6%.

Risks Analysis

According to the TipRanks Risk Factors tool, Johnson Controls is at risk mainly from three factors: Legal & Regulatory, Production, and Finance & Corporate. While the Legal & Regulatory risk category contributes 15 risks to the total 39 risks identified for the stock, Production, and Finance & Corporate account for 7 and 6 risks, respectively.

Download the TipRanks mobile app now 

To find good ideas for stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly launched tool that unites all of TipRanks’ equity insights.

Related News:
Amazon Reveals 20-for-1 Stock Split & $10B Share Buyback; Shares Jump
Qualcomm Rewards Shareholders with 10% Annual Dividend Hike
3 “Strong Buy” Dividend Stocks Yielding at Least 5%