This Dividend Stock Has a Bright Future

Shares of Magna International Inc. (TSX:MG)(NYSE:MGA) were up 1.11% in late morning trading on October 17. The stock has increased 15% in 2017 and 23% year over year. The Canadian global automotive supplier is well positioned to capitalize from forward-thinking trends in the industry.

Magna released its second quarter results on August 11. The company posted record sales of $9.68 billion which represented a 3% increase year over year. Magna did experience a dip in operating income due to a slowdown in North American and European light vehicle production. North American light vehicle production has dipped 1% while European production was up 1% in the first 6 months of 2017.

On September 8 Magna announced that it would commit to an expansion to its Alabama aluminum casting facility. The company will invest $60 million into the 150,000 square foot facility. The facility boasts the manufacturing process for high-pressure aluminum casting which is essential in vehicle lightweighting.

Vehicle light weighting also results in improved fuel economy which cuts into the greenhouse gas emission life cycle for vehicles. As governments and private enterprise work together to reduce output in this regard the parts Magna manufactures will likely be in higher demand heading into the 2020s.

Magna International stock offers a dividend of $0.35 per share representing a 2% dividend yield. In addition to the income it provides this is an attractive growth option for any portfolio.