Energy Sector Dominates High-Paying Dividends
Pioneer Natural Resources (PXD)
Civitas Resources and Chord Energy
Maximizing Shareholder Returns with a New Dividend Approach
Oil and Gas Companies Reward Shareholders with Dividends
Civitas (CIVI) is a notable oil and gas company with a focus on operations in Colorado, a state known for its stricter standards in oil drilling compared to others like Texas. While Civitas frequently acquires other companies, it has recently been purchasing acreage in the Permian Basin. The company recently announced a 50 cent base dividend per share and a $1.24 variable dividend in its latest quarterly report.
Houston-based Chord Energy (CHRD) has also been rewarding shareholders with its variable dividend over the past few years. In fact, last year it paid out an impressive $27.03 per share. However, Chord Energy has shifted its focus towards buying back stock, with buybacks accounting for almost 90% of its shareholder returns in the latest quarter after considering the base dividend. The company explained its strategy saying, “We aimed to increase share repurchases as a percentage of return capital in recognition of the discount that we believe Chord trades at relative to peers and our intrinsic value.”
Notably, oil and gas pipeline operators have been stepping up their dividend payments as well. While the magnitude of their payouts may not be as surprising as those of producers, these midstream energy companies have been consistently rewarding investors with large dividends for years. This is partly due to their historical corporate structure as master limited partnerships, which were designed to distribute excess cash flow to investors. Despite reorganizing as traditional corporations, many of these companies remain dedicated to dividend payments. Among them, Kinder Morgan (KMI) and Antero Midstream (AM) are among the top dividend-payers in the sector.