Omega Flex Inc's Dividend Analysis
Insight into Omega Flex Inc's Upcoming Dividend Payment
Omega Flex Inc (NASDAQ:OFLX) recently announced a dividend of $0.33 per share, payable on 2024-01-04, with the ex-dividend date set for 2023-12-18. As investors look forward to this upcoming payment, the spotlight also shines on the company's dividend history, yield, and growth rates. Using the data from GuruFocus, let's look into Omega Flex Inc's dividend performance and assess its sustainability.
What Does Omega Flex Inc Do?
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Omega Flex Inc is a manufacturer of flexible metal hoses. It operates in the segment of manufacture and sale of flexible metal hose and accessories which are used for gas piping within residential and commercial buildings. Omega Flex sells its products under the TracPipe, CounterStrike, DoubleTrac, AutoFlare, DEF-Trac, SolarTrac, and AutoSnap brands. It serves various markets which include construction, manufacturing, transportation, petrochemical, pharmaceutical, and other industries. Geographically, Omega Flex operates in the United States.
A Glimpse at Omega Flex Inc's Dividend History
Omega Flex Inc has maintained a consistent dividend payment record since 2012. Dividends are currently distributed on a quarterly basis. Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Omega Flex Inc's Dividend Yield and Growth
As of today, Omega Flex Inc currently has a 12-month trailing dividend yield of 1.51% and a 12-month forward dividend yield of 1.54%. This suggests an expectation of increased dividend payments over the next 12 months.
Over the past three years, Omega Flex Inc's annual dividend growth rate was 5.30%. Extended to a five-year horizon, this rate increased to 12.00% per year. Based on Omega Flex Inc's dividend yield and five-year growth rate, the 5-year yield on cost of Omega Flex Inc stock as of today is approximately 2.66%.
The Sustainability Question: Payout Ratio and Profitability
To assess the sustainability of the dividend, one needs to evaluate the company's payout ratio. The dividend payout ratio provides insights into the portion of earnings the company distributes as dividends. A lower ratio suggests that the company retains a significant part of its earnings, thereby ensuring the availability of funds for future growth and unexpected downturns. As of 2023-09-30, Omega Flex Inc's dividend payout ratio is 0.74, which may suggest that the company's dividend may not be sustainable.
Omega Flex Inc's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Omega Flex Inc's profitability 9 out of 10 as of 2023-09-30, suggesting good profitability prospects. The company has reported positive net income for each year over the past decade, further solidifying its high profitability.
Growth Metrics: The Future Outlook
To ensure the sustainability of dividends, a company must have robust growth metrics. Omega Flex Inc's growth rank of 9 out of 10 suggests that the company's growth trajectory is good relative to its competitors.
Revenue is the lifeblood of any company, and Omega Flex Inc's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Omega Flex Inc's revenue has increased by approximately 4.10% per year on average, a rate that underperforms than approximately 59.01% of global competitors.
The company's 3-year EPS growth rate showcases its capability to grow its earnings, a critical component for sustaining dividends in the long run. During the past three years, Omega Flex Inc's earnings increased by approximately 11.00% per year on average, a rate that underperforms than approximately 49.96% of global competitors.
Lastly, the company's 5-year EBITDA growth rate of 8.90%, which underperforms than approximately 47.92% of global competitors.
Concluding Thoughts on Omega Flex Inc's Dividend Profile
Omega Flex Inc's dividend payments, consistent dividend growth rate, manageable payout ratio, and strong profitability indicators make it an interesting prospect for value investors. However, investors should also consider the company's growth metrics, which show a mixed performance relative to global competitors. With these factors in mind, investors should evaluate if Omega Flex Inc aligns with their investment strategy and risk tolerance. For those seeking to diversify their portfolio with high-dividend yield stocks, GuruFocus Premium users can utilize the High Dividend Yield Screener.
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
This article first appeared on GuruFocus.
