Lowe’s raises dividend, to lift implied yield above 2.15%

Shares of Lowe’s Companies Inc.
LOW,
+1.78%
rallied 1.5% in morning trading Friday, after the home improvement retailer raised its quarterly dividend by 4.8%, to $1.10 a share from $1.05 a share. Shareholders of record on July 26 will be paid the new dividend on Aug. 9. Based on current stock prices, the new annual dividend rate implies a dividend yield of 2.16%, which compares with the current yield for rival Home Depot Inc.’s stock
HD,
+1.19%
2.89% and the implied yield for the S&P 500
SPX,
+1.11%
of 1.64%. Lowe’s dividend hike comes after the company reported earlier this week fiscal first-quarter profit that beat expectations. The stock has gained 2.3% year to date through Thursday, while Home Depot shares have lost 8.6% and the S&P 500 has advanced 8.8%.