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Cimarex (XEC) Rewards Stockholders With 12.5% Dividend Hike

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Cimarex Energy Co. announced approvals from its board of director to hike its quarterly cash dividend. The new dividend of 18 cents per share reflects a hike of 12.5% as compared to the preceding payout of 16 cents.

The dividend will likely be paid on Nov 30, 2018, to shareholders of record as of Nov 15, 2018. With the increase, the company’s dividend yield now stands at 0.85%, higher than the collective yield of 0.65% of the stocks belonging to the industry. This reflects the company’s strong commitment to return cash to stockholders on the back of strengthening operations.

Cimarex has strong presence in the prospective Permian Basin and Mid-Continent resources. In the respective regions, the explorer’s daily oil equivalent production grows almost 16% and 9% through first-half 2018. Moreover, the company expects its daily oil equivalent production to increase 14% to 18% through 2018. Growing production will likely help the company continue to return cash to stockholders.

The explorer’s balance sheet is also less levered as compared to the broader industry. The debt-to-capitalization ratio of the company stands at 34.01%, significantly lower than the industry’s 45.5%. In fact, over the past five years, the company’s debt-to-capitalization ratio has been consistently below the industry, reflecting strong financials and ample liquidity.

Despite all the positives, Cimarex — headquartered in Denver, CO — has plunged 16.2% in the past year against the industry’s 22.1% rally.

Currently, the stock carries a Zacks Rank #3 (Hold). Meanwhile, a few better-ranked players in the energy space are McDermott International, Inc. , Petroleo Brasileiro S.A. or Petrobras (PBR - Free Report) and Helix Energy Solutions Group, Inc. (HLX - Free Report) , each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

McDermott’s earnings surpassed the Zacks Consensus Estimate in the last four quarters, the average positive surprise being 101.7%.

Petrobras’ bottom line beat the Zacks Consensus Estimate in three of the trailing four quarters, the average beat being 10.4%.

Helix Energy’s bottom line exceeded the consensus mark in three of the last four quarters, the average earnings surprise being 66.7%.

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