Ritchie Bros. Auctioneers Increases Dividend

Ritchie Bros. Auctioneers Inc. (RBA) boosted its dividend on Tuesday, following stellar second quarter results from the auction house that included year over year increases in earnings per share and auction revenues.

The company, whose EPS rose from C70¢ to C76¢ on a 20% increase in auction revenues during the quarter, raised its annual dividend from a prior rate of C84¢ to C96¢ on expectations that cash flow will remain strong. Ritchie Bros. shares were up than 4% on the announcement, closing the day at C$69.74.

"We believe that this positive trend is likely to continue for the foreseeable future, regardless of economic conditions, Blackmont analyst Avi Dalfen said in a note to clients, adding Ritchie Bros. is growing its market share out from approximately 3% in what is conservatively estimated as a C$100-billion industry.

He reiterated his "buy" rating on Ritchie Bros and increased his price target on the shares from C$68 to C$71.

RBA 1-yr chart: