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ABB: Sailing Through Headwinds With A High Yield

Published Sun, 12 Jul 2015 18:22:09 -0400 on Seeking Alpha

Swiss power and automation giant ABB (NYSE: ABB) is being bogged down by myriad issues, but shares look like they are offering value. I'd like to explore the company's current financial condition, as well as its fundamentals and future prospects. It seems like a cheap way to get exposure to Europe, but I'm not so sure I want that right now if the eurozone doesn't improve. One thing that it does have going for it, however, is its high-yielding dividend.Something doesn't add up...The first thing that jumped out at me when first looking at ABB was the low dividend yield of just 0.89%, as advertised on Yahoo Finance and other sites. It seems there's a discrepancy somewhere. Checking with the company itself, it seems this may offer an explanation:"The dividend for 2014 is paid in a tax efficient way in two tranches: one of 0.55 Swiss francs from ABB Ltd's capital contribution reserve in May 2015 and the other of 0.17 Swiss francs from a reduction in the nominal par value of the ABB share from 1.03 Swiss francs to 0.86 Swiss francs in July, 2015."We can conclude that the full 2014 dividend is actually 0.72 Swiss francs (or about $0.76), not the $0.18 shown on many financial sites. This puts the company's current dividend yield at about 3.8%.Besides the freeze between 2007 and 2008, the company also has a decent dividend growth history as well:The last increase of just 2.86% isn't very impressive, though. Still, its current high yield is more... Read more

Stock name Last trade   P/E Earnings/Share Dividend/Share Dividend yield
ABB 19.86   18.9 1.05 0.00 4.17

ABB - ABB
ABB - ABB  


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