Autoliv Hikes Dividend - Analyst Blog

Autoliv Inc. (ALV) raised its quarterly dividend payment by 17% to 35 cents per share for the fourth quarter. The increased dividend will be paid on Dec 9, 2010 to shareholders of record as of Nov 4, 2010.
 
The company suspended its dividend payment since the third quarter of last year in the light of a decline in global light vehicle production due to the economic recession. Autoliv resumed its dividend payment in the third quarter of this year. The third quarter dividend of 30 cents per share is payable next month.
 
Autoliv posted a profit of $158.6 million or $1.73 per share (excluding the loss on extinguishment of debt) in the second quarter of 2010, compared to the loss of $20.7 million or 24 cents per share in the same quarter a year ago. With this, the automotive safety components manufacturer has far exceeded the Zacks Consensus Estimate of $1.36 per share during the quarter.
 
Consolidated sales soared 51% to $1.8 billion, reflecting a 40% growth in organic sales. The company’s results were driven favorably by restructuring actions as well as strong sales to Chrysler, Mitsubishi, General Motors (MTLQQ), Hyundai/KIA and Nissan Motors (NSANY).
 
Operating income rose by $241 million to $229 million due to an increase in gross profit by $226 million and a decrease in restructuring charges by $29 million. These were partially offset by a rise in research, development and engineering expenses by $10 million and an increase in selling, general & administrative expenses by $8 million. Operating margin stood at 12.7% during the quarter.
 
The company anticipates consolidated sales to grow by 25% in the upcoming quarter and 35% for the full year 2010. This is based on the organic sales growth expectation of 20% for the upcoming quarter and 28% for the full year. The company also expects an operating margin of at least 10% for the third quarter and more than 11% for the full year.
 
Due to the improved results and strong outlook, Autoliv is a Zacks #1 Rank ('Strong Buy'). Following the announcement of a dividend hike, the company’s share price inched up more than 2% to $56.38 after the market closed yesterday.

 
AUTOLIV INC (ALV): Free Stock Analysis Report
 
MOTORS LIQUIDAT (MTLQQ): Free Stock Analysis Report
 
NISSAN ADR (NSANY): Free Stock Analysis Report
 
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