NewMarket Corporation Boosts Dividend: A Win for Shareholders

NewMarket Corporation (NYSE: NEU) has announced a 10% increase in its quarterly dividend, raising it to $2.75 per share. This move reflects the company's strong financial performance and commitment to returning value to shareholders. Let's dive into the details and explore the implications of this dividend hike.



A History of Dividend Growth

NewMarket has a history of increasing its dividend, with the quarterly payout growing from $2.10 per share in 2023 to $2.25 in 2024, and now to $2.75 in 2025. This consistent growth demonstrates the company's financial strength and its ability to generate cash flow, even in challenging market conditions.

Drivers of Dividend Growth

Several factors contributed to NewMarket's decision to increase its dividend:

1. Strong Financial Performance: NewMarket reported full-year net income of $462.4 million and earnings per share of $48.22 in 2024, reflecting the company's robust financial health.
2. Operational Efficiency: The company's focus on operational efficiency enabled it to achieve lower operating costs, contributing to higher operating profits.
3. Acquisition of American Pacific Corporation (AMPAC): The acquisition of AMPAC in January 2024 contributed positively to the company's specialty materials segment, surpassing pre-acquisition expectations.
4. Cash Flow Generation: NewMarket generated strong cash flows during 2024, paying dividends, funding capital expenditures, and repurchasing common stock.
5. Debt Reduction: Since the AMPAC acquisition, NewMarket has made net payments of $373.0 million on its revolving credit facility, reducing its Net Debt to EBITDA ratio to 1.2.



Impact on Shareholders

The increased dividend yield can positively impact NewMarket's stock valuation by making the company more attractive to income-oriented investors. A higher dividend yield can lead to increased demand for the stock, potentially driving up the stock price. Additionally, the consistent and growing dividend payments demonstrate the company's financial strength and commitment to shareholder value.

In conclusion, NewMarket Corporation's 10% increase in its quarterly dividend is a testament to the company's strong financial performance and commitment to returning value to shareholders. This move aligns with the company's long-term strategy and bodes well for the future of the company and its investors. As a shareholder, you can take comfort in knowing that NewMarket is dedicated to generating cash flow and distributing it to you in the form of dividends.