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A Trio of Long-Term Payers Announces Dividends

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·5 min read
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Many companies have already canceled or deferred the payment of their dividends as a precautionary measure in response to the ongoing economic disruption caused by the novel coronavirus (Covid-19).

However, several companies are keeping up payments to shareholders, which could be interpreted as a sign of financial strength as long as the company is able to support the dividend without making itself financially vulnerable.

These stocks are also long-term dividend distributors as they have been paying dividends for more than five years.

The GEO Group Inc

The Boca Raton, Florida-based real estate investment trust focusing on healthcare facilities in the U.S. and internationally announced that on April 24, it will pay a quarterly dividend of 48 cents per common share, which is on par with the prior payment, to shareholders of record April 17. The ex-dividend date is scheduled for April. 16.

Based on Monday's closing share price of $11.93, the quarterly dividend generates a high yield of 16.1% for both the forward dividend and the trailing 12-month dividend, while the industry median stands at 7.53-7.54%.

The GEO Group Inc has been paying quarterly dividends for more than eight years and increased them by a compound annual growth rate (CAGR) of 4.33% over the past five years.

The company sustains the payment of the quarterly dividend thanks to the availability of $32.5 million in cash on hand as of the most recent quarter, which ended on Dec. 30, 2019. Almost $340 million in trailing 12-month operating cash inflows were also added to the company's financial resources.

In the past year, the share price lost 40.4% and determined a 52-week range of $9.95 to $24.03. Market capitalization stands at around $1.45 billion.

The Peter Lynch chart below shows that the stock is trading below its earnings line, indicating that the current share price is not expensive.

Wall Street sell-side analysts recommend a hold rating for shares of The GEO Group Inc and have established an average target price of $23 per share.

Lindsay Corp

The Omaha, Nebraska-based provider of water management and road infrastructure products and services in the U.S. and internationally announced that on May 29, it will pay a quarterly cash dividend of 32 cents per common share to shareholders of record May 15. The ex-dividend date is scheduled for May 14. The payment will represent a 3.2% hike from the prior quarterly cash dividend.

Based on Monday's closing share price of $94.45, the quarterly cash dividend generates a yield of 1.32% for both the forward dividend and trailing 12-month dividend versus the 3.13-3.17% for the industry median.

Lindsay Corp has been paying dividends for about 25 years. The dividend has grown at a CAGR of 3.19% over the past five years.

The company finances the payment of the quarterly dividend with cash balances totaling about $121 million as of the most recent quarter, which ended on Nov. 30, 2019. The company also used cash inflows of nearly $20 million, which came from the prior 12 months of operating activities.

Year to date, the stock price has decreased by 1.6%. The 52-week range is $71.86 to $111.76 and the market capitalization is $1.02 billion.

Based on the Peter Lynch chart, the stock is trading above its earnings line, indicating that the current share price is not at its cheapest.

Wall Street sell-side analysts recommend a hold rating for shares of Lindsay Corp and have set an average target price of $91 per share.

EMCOR Group

The Norwalk, Connecticut-based provider of electrical and mechanical engineering and construction services in the U.S. announced that on April 30, it will pay a quarterly cash dividend of 8 cents per common share, which is on par with the previous payment. The dividend will be sent to shareholders of record April 17. The ex-dividend date is scheduled for April 16.

Based on Monday's closing share price of $59.02, the quarterly dividend produces a yield of 0.55% for both the forward dividend and the trailing 12-month dividend, while the industry median is 3.69 for the forward dividend yield and is 3.55% for the trailing 12-month dividend yield.

EMCOR Group Inc has been paying quarterly dividends for more than eight years. The dividend was flat over the past five years.

Nearly $360 million cash was available on hand at the end of the most recent quarter, which ended on Dec. 30, 2019, while the prior 12 months of operating activities produced cash inflows of $355.7 million.

The share price has declined by 31.6% so far this year. The 52-week range is $41.85 to $93.54 and the market capitalization is $3.32 billion.

The Peter Lynch chart illustrates that the stock is trading below the earnings line, suggesting that the current share price is not expensive.

Wall Street sell-side analysts recommend an overweight rating for shares of EMCOR Group Inc and have established an average target price of $83.20 per share.

Disclosure: I have no positions in any securities mentioned.

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This article first appeared on GuruFocus.