Portfolio Update
The FiveTwenty portfolio received $554.71 in dividends in the past week. HD, K, MMM, ORI, PII, and WBA paid their quarterly dividend during the week.
| Past Week Dividend | $554.71 |
| Current Quarter Dividend (Q2 2023) | $2,053.05 |
| LifeTime Dividend | $12,226.63 |
| Estimated Annual Dividend | $9,624.52 |
The capital allocation for the week of 06/18/2023 to 06/24/2023 will be used to add to our position in Black Hills Corp (NYSE: BKH)
BKH – Position Update
Since our last check-in on BKH in week 51 of 2022, the company reported Q4 and FY 2022 earnings on 02/07/2023, and Q1 2023 earnings on 05/03/2023. Furthermore, the share price decreased 9% from $68.75 to $62.57.
| TTM | Prev. Update | 10-year median | |
| Dividend Streak | 52 years | 52 years | |
| Yield | 3.95% | 3.51% | 3.11% |
| Payout Ratio | 63.33% | 59.65% | 58% |
| P/E | 16.04 | 17.34 | 18.77 |
Q1 2023 earnings report
Did BKH’s latest earnings report raise any warning flags?
The increase in revenue in Q1 2023 was largely offset by increases in cost of fuel for the gas utilities business and interest expenses. Overall, revenue grew 11.9%, while net income decreased (2.9)%, and EPS were (4.9)% lower compared to Q1 2022.
| Revenue (in millions) | Net Income (in millions) | EPS . | |
| Q1 2022 | $823.6 | $117.5 | $1.82 |
| Q1 2023 | $921.2 | $114.1 | $1.73 |
| % Change | 11.9% | (2.9)% | (4.9)% |
Additional noteworthy developments during the quarter:
- On 01/26/2023, BKH received approval from Wyoming Public Service Commission for a rate increase that will provide $8.7 million in new annual revenue.
- On 04/24/2023, the company declared a quarterly dividend of $0.625 per share payable on 06/01/2023 to shareholders of record on 05/18/2023.
Looking ahead, the company reaffirmed its full-year EPS guidance of $3.65 to $3.85. It also reiterated its goals of 4% to 6% long-term EPS growth, 55% to 65% dividend payout ratio, and $3.5 billion target in capital investments between 2023 and 2027.
Thesis
Why are we adding to our position in BKH?
BKH has continued to steadily and reliably execute on the long-term strategy. The company managed to grow revenue and keep cost increases under control. In addition, through it capital allocation plan the company continues to add renewable and conventional assets to its portfolio that will support future revenue and earnings growth.
We continue to believe in the long-term prospects of the company and are happy to continue to expand our holdings at a reasonable valuation.
Previous Articles
- 2022 Week 51: Black Hills Corp (NYSE: BKH)
- 2021 Week 30: Black Hills Corp (NYSE: BKH)
- 2021 Week 25: Black Hills Corp (NYSE: BKH)
Additional Research
Photo by Waldemar on Unsplash