(DUK) Duke Energy Raises Dividend

Duke Energy Corporation (DUK) raised the quarterly cash dividend on its common stock by 5 cents to 25 cents per share. This action increases the annualized dividend from 98 cents to $1.00.

The dividend is payable on September 16, 2011 to shareholders of record at the close of business on August 12, 2010. This is the 85th consecutive year that Duke Energy has paid a quarterly cash dividend on its common stock.

Earlier, Duke Energy reported a strong first quarter 2011. Earnings in the most recent quarter surpassed both the year-ago results and the Zacks Consensus expectation mainly driven by strong performance at Duke Energy International.

Duke Energy expects its adjusted earnings per share for 2011 to be in the range of $1.35 to $1.40. The Zacks Consensus Estimate for 2011 is presently at $1.37.

Duke Energy, a Zacks #3 Rank (‘hold’) stock, is one of the largest electric power holding companies in the United States. Its regulated utility operations serve approximately 4 million customers located in five states in the Southeast and Midwest, comprising a population of approximately 11 million.

Its commercial power and international business segments own and operate diverse power generation assets in North America and Latin America, including a growing portfolio of renewable energy assets in the United States.

Duke Energy’s stable U.S. electricity and gas operations, spread over North Carolina, South Carolina, Indiana, Ohio and Kentucky, generate a relatively stable and growing earnings stream.

Looking ahead, our bullish outlook for the company is supported by its ongoing merger proceedings with Progress Energy Inc. (PGN) paving the way for the largest U.S. utility. Moreover, its strong balance sheet and ongoing capital expansion projects add visibility to the story.

The present unfavorable macro backdrop, fossil-fuel based generation assets, lower demand for electricity, foreign currency exchange volatility and pending regulatory cases continue to contain valuation. Thus, we maintain our long-term market Neutral recommendation on the stock.

DUKE ENERGY CP (DUK): Free Stock Analysis Report

PROGRESS ENERGY (PGN): Free Stock Analysis Report

Zacks Investment Research

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