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Atlas Arteria share price set to drop as the company trades ex-dividend

The Atlas Arteria Group  (ASX: ALX) share price is set to fall this morning as the shares begin trading ex-dividend.

How much is the Atlas dividend?

On Tuesday, Atlas announced a 15 cents per stapled security (cps) distribution for the first half of the year which will be paid by both Atlas Arteria Limited (ATLAX) and Atlas Arteria International Limited (ATLIX).

The ATLAX distribution will comprise a 7.8 cps capital return and an unfranked dividend of 0.2 cps, while the ATLIX distribution will comprise a foreign dividend of 7.0 cps.

This 15 cps distribution represents a pro-forma annualised dividend yield of 4.22% based on yesterday’s closing price of $7.11 per share.

What’s been happening for Atlas?

Atlas Arteria, formerly known as Macquarie Atlas Roads, is one of the world’s largest developers and operators of private toll roads.

The company last week announced its FY18 results (its first as Atlas Arteria) which has the company’s share price to a record high and seen its market cap swell to $4.9 billion.

The Atlas share price has been a top performer in recent years and has rocketed 140% higher in the last 5 years as it has grown its asset base and continued to perform strongly within the Macquarie Infrastructure Group.

This extended period of growth has seen the Atlas share price outperform several of its ASX infrastructure and engineering peers in recent years including Seven Group Holdings Ltd (ASX: SVW) and Qube Holdings Ltd (ASX: QUB).

Is Atlas in the buy zone?

With Atlas shares beginning to trade ex-dividend today, Fools might be considering jumping on board with Atlas to ride the share price even higher in 2019.

While the company has proven to be a reliable performer over an incredibly long period of time, I think headwinds are continuing to build in the Industrials sector, particularly in construction. I’d be wary of further organic growth for the group despite Atlas’ potential to deliver a stable 4.00% dividend yield from its toll road income even in an economic downturn.

For those are similarly bearish on Atlas, I think these top growth shares could prove to be market-beaters in a diversified portfolio.

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Motley Fool contributor Lachlan Hall has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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