Where does Ingersoll-Rand rank after its 25% announced dividend increase?

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Ingersoll-Rand Plc (IR) announced a regular quarterly dividend of $0.40, a 25 percent increase from the prior rate of $0.32 per share. The dividend will be paid at the new higher rate on December 30, 2016, to shareholders of record at close of business on December 9, 2016. Ingersoll-Rand is currently priced at $68.78.

Listed in the table below are the quarterly dividend payments since 2010. Our analysis of Ingersoll-Rand Plc. as a Top 100 Dividend Stock candidate is listed below;

Date Quarterly Dividend
12/9/2016 0.4
9/7/2016 0.32
6/8/2016 0.32
3/9/2016 0.32
12/9/2015 0.29
9/9/2015 0.29
6/10/2015 0.29
3/11/2015 0.29
12/10/2014 0.25
9/10/2014 0.25
6/11/2014 0.25
3/12/2014 0.25
10/30/2013 0.168
9/11/2013 0.168
6/12/2013 0.168
3/8/2013 0.168
12/12/2012 0.128
9/11/2012 0.128
6/14/2012 0.128
3/8/2012 0.128
12/12/2011 0.096
9/9/2011 0.096
6/15/2011 0.096
3/9/2011 0.056
12/10/2010 0.056
9/10/2010 0.056
6/10/2010 0.056
2/12/2010 0.056

Analysis of Ingersoll-Rand Plc. is based upon our five key criteria for the Top 100 list, which include; 

Category Value Score
Dividend Yield 1.89% 291
Dividend Growth (3-6 year avg) 26% 131
Forward P/E 15.42 165
S&P Financial Rating A 120
Beta 1.20 125
Total Score   832

Additional Information on P/S ratio and historical yield;

% Yield 3 Year Div. Growth Rate 6 Year Div. Growth Rate SPS 2016 P/S Ratio 10 yr P/S Low 10 yr P/S High 5 yr max Yield % 5 yr lowest Yield %
1.89% 17% 34% 53 1.32 0.48 1.76 2.38% 1.05%

Final Analysis;

  • Ingersoll-Rand’s dividend yield is on average with that of the S&P 500 Index and is trading at the higher end of its average historical dividend yield.
  • Ingersoll-Rand maintains an impressive 3 year dividend growth rate of 17%.
  • Ingersoll-Rand has paid out a dividend consecutively for the past 23 years.
  • Ingersoll-Rand is trading at a modest forward P/E ratio but above its average price/sales (P/S) range.  From a relative valuation perspective based upon P/S, Ingersoll-Rand is slightly overvalued.
  • Ingersoll-Rand maintains a credit rating of A. This is investment grade, a positive.
  • Ingersoll-Rand maintains a beta of 1.20, higher than the average company.

Based upon its elevated historical P/S ratio and the above-average beta, Ingersoll-Rand does not qualify as one of our Top 100 Dividend Stocks.

Ingersoll-Rand Plc. Dividend Yield Chart (Click to enlarge)

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Chart Explanation:  Dividend growth stocks may be viewed favorably when the current yield is above historical readings for the past 5 years.

Further information on dividend investing and evaluating dividend growth candidates can be found at http://seekingalpha.com/author/timothy-mcintosh/articles

4 thoughts on “Where does Ingersoll-Rand rank after its 25% announced dividend increase?

  1. This is welcomed news. I’m quite pleased with this recent increase and IR’s performance in my portfolio. It has been with me since 2007 and I kept the ALLE spin off from a few years ago as well. Not sure why IR isn’t found in more dividend growth portfolios. It literally is one of my top performers.

  2. Ingersoll-Rand is a great company and the dividend growth is very impressive. It came very close to making the Top 100 list, only its beta and P/S ratios were slightly elevated. We still believe it is a great stock for any dividend investor to consider.

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