Linear Boosts Dividend, Beats Estimates, Guides Low

Linear Technology Corporation (LLTC) reported second quarter results that beat Wall Street’s expectations and raised its dividend for the 19th consecutive year after the closing bell. But weak third quarter guidance sent shares down more than 4% in after-hours trading.

Second Quarter Results

Linear posted Q2 earnings of $0.62 per share on $383.6 million in revenue, topping the consensus analyst estimates for both profit ($0.58 per share) and sales ($378.5 million). Net income of $143.7 million was a 5% improvement sequentially, and a 90% increase over last year’s Q2 figure. Revenue fell 1% sequentially, but was up 50% compared to the same period last year.

Third Quarter Outlook

The company expects third quarter earnings and revenue to decline 6-10% sequentially. That means net income of $0.55 to $0.58 per share and revenue of $345.3 to $360.6 million. Wall Street is currently expecting Q3 results on the high end of that profit range ($0.58 per share) and way above Linear’s sales range ($373.1 million).

Dividend Increase

Linear declared a quarterly dividend of $0.24 per share, a 4.4% increase over the $0.23 per share paid each of the last four quarters by the integrated circuit manufacturer. This marks the 19th consecutive year the company has boosted its payout. The ex-dividend date is February 16.

Market Reaction

Shares of LLTC fell to $34.55 (-4.37%) in extended trading, where they now carry a 2.78% dividend yield.

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