Oil and gas giant Exxon Mobil (NYSE:XOM) released its third-quarter earnings last week and it also boosted its payout. It was a solid period for the business as its adjusted per-share profit of $1.92 came in higher than analyst expectations of $1.88. For dividend investors, the more important news was that the company was also increasing its dividend.
Shareholders will now receive $0.99 per quarter in dividends, up from the $0.95 it was previously paying, for an increase of 4.2%. The increase in the payout means that the stock’s yield is approximately 3.4%, which is more than twice the S&P 500 average (1.3%). Exxon has been raising its dividend for decades and it’s one of the main reasons investors hold on to the stock; it gives them an incentive to buy and hold for years. With this increase, the company extends its dividend streak to 42 years.
Since the start of the year, Exxon’s stock has made for a solid buy as it has generated returns of around 17%. And despite the rise in value, a case can be made for the stock still looking like a fairly cheap buy as it trades at just 13 times next year’s earnings.
The company has expanded via acquisitions over the years and continues to be an excellent investment to hang on to. If you’re looking for a good dividend or just a hedge against inflation, investing in the oil and gas stock can be a great move to make as its recent earnings numbers show the business is doing just fine.