Pharmaceutical services provider AmerisourceBergen Corp. (ABC) Tuesday announced a two-for-one stock split of its outstanding commmon shares, and said that the board plans to render a 20% increase in quarterly dividend. In addition, the company also reaffirmed its fiscal 2009 earnings expectations.
AmerisourceBergen noted that the split will be in the form of a stock dividend, whereby each stockholder will receive one additional share for each share owned. The new shares would be provided to stockholders of record as of May 29, 2009 at the close of business on May 29, 2009, with an additional share for every share they currently own. The split would increase the number of company shares from 150.8 million to 301.5 million shares.
On a post-split basis beginning in the third fiscal quarter of 2009, stockholders would receive a new quarterly dividend of $0.06 per share, which represents an increase of 20%. Previously, on November 13, 2008, the company provided a 33% increase in quarterly dividend rate to $0.10 per share.
AmerisourceBergen also reaffirmed its fiscal year 2009 earnings expectations. For the year, the company continues to expect earnings from continuing operations in the range of $3.18 to $3.30 per share, or $1.59 to $1.65 per share on a post-split basis, which compares to $2.89, or $1.44 per share on a split-adjusted basis, in fiscal year 2008.
AmerisourceBergen also reaffirmed the assumptions supporting fiscal 2009 earnings from continuing operations range, with revenue growth in the range of 1% to 3% and operating margin expansion in the low-to-mid single digit basis point range.
Analysts polled by Thomson Reuters currently expect earnings of $3.26 per share on revenues of $70.54 billion for the year. Analysts' estimates typically exclude one-time items.
On April 17, 2009, brokerage Deutsche Securities upgraded AmerisourceBergen securities to 'Buy' from 'Hold', with a mean target of $42.00.
AmerisourceBergen also said it still expects to repurchase around $350 million of its common shares in fiscal 2009.
ABC is currently trading at $35.97, up $0.39 or 1.10%, on a volume of 0.34 million shares. In the last 52-week period, the stock traded in the range of $26.66 to $44.45, on a three-month average volume of 2.15 million shares.
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