SNC hikes dividend despite profit drop

Article Excerpt

SNC-Lavalin Group Inc. $46 (Toronto symbol SNC Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 151.0 million; Market cap: $6.9 billion; SI Rating: Average) earned $0.45 a share (total $69.1 million) in 2007, down 49.4% from $0.89 a share ($136.6 million) in 2006. The 2007 results included a $267.3 million pre-tax operating loss at its power division due to delays in constructing a new power plant in Brampton, Ont. Revenue rose 28.8% to $6.7 billion from $5.2 billion. SNC has also increased its quarterly dividend by a third, from $0.09 a share to $0.12. The new annual rate of $0.48 yields 1.0%. However, the stock is expensive at 29.1 times its forecast 2008 earnings of $1.58 a share, particularly for a cyclical company. SNC-Lavalin is a hold. hold…