Kansas City Southern (KSU) will raise its quarterly dividend by 10.0 percent to 44 cents quarterly in 2020. This follows a 11.1 percent dividend hike to $0.40 per share in 2019. The railroad operator has now raised its dividend three consecutive years.

The next dividend is payable on January 20, 2021, to stockholders of record at the close of business on December 31, 2020. A new $1.76 per share annual dividend rate yields 0.9% at a stock price of $188.

In its press release dated November 10, 2020 KCS mentions that it will implement a quarterly dividend approach that targets a low 20% range payout. The company also announced a new $3.0 billion share repurchase program, expiring December 31, 2023. KCS says it intends to continue deploying available cash in the following manner: Approximately 40-50% to capital projects and strategic investments; and approximately 50-60% to share repurchases and dividends.

If we include this new dividend hike for 2020 the company will pay an estimated $166 million annually in dividends to shareholders. 

Kansas City Southern (KCS) is a transportation holding company with railroad investments in the U.S., Mexico and Panama. Its primary U.S. holding is The Kansas City Southern Railway Company, serving the central and south central U.S. Its international holdings include Kansas City Southern de Mexico, S.A. de C.V., serving northeastern and central Mexico and the port cities of Lázaro Cárdenas, Tampico and Veracruz, and a 50 percent interest in Panama Canal Railway Company, providing ocean-to-ocean freight and passenger service along the Panama Canal. KCS' North American rail holdings and strategic alliances with other North American rail partners link the commercial and industrial centers of the U.S., Mexico and Canada.