Commodity-linked companies could potentially pay higher dividends over coming years as earnings rise and balance sheets get stronger, Richard Davis, a fund manager at U.S.-based BlackRock (BLK.N), said.
"Commodity prices are at attractive levels, cash flows are at record levels and earnings are at record levels," Davis said at a briefing.
Making the case for higher dividends, Davis cited the forecasted earnings of commodity companies in the U.S. benchmark S&P 500 .SPX this year, which at nearly 30 percent is below the expected dividend of only 22 percent.
"Natural resources are attractive on a valuation basis, mining sector balance sheets are getting stronger," Davis said, adding that demand growth for commodities over coming years will be strong....MORE
BlackRock manages $45 billion overall in commodity equities and worldwide the company as at March 31, 2011 had $3.648 trillion under management.