Unraveling Flexsteel Industries Inc's Dividend Performance: A Deep Dive
Assessing the Sustainability and Prospects of Flexsteel Industries Inc's Dividend Payments
Flexsteel Industries Inc(NASDAQ:FLXS) recently announced a dividend of $0.15 per share, payable on 2023-10-09, with the ex-dividend date set for 2023-09-26. 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 deep dive into Flexsteel Industries Incs dividend performance and assess its sustainability.
What Does Flexsteel Industries Inc Do?
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Flexsteel Industries Inc is a United States-based company that manufactures, imports, and markets residential upholstered wooden furniture products. The products offering include sofas, loveseats, chairs, rockers, desks, tables, convertible bedding units, and bedroom furniture. The company's products are intended for use in home, office, hotel, healthcare, and other contract applications. A featured component in the company's upholstered furniture is the durable Blue Steel Spring. It operates in the business segment of Furniture products. The company's furniture products business involves the distribution of manufactured and imported products for residential and contract markets, of which key revenue is derived from the residential market.
A Glimpse at Flexsteel Industries Inc's Dividend History
Flexsteel Industries Inc has maintained a consistent dividend payment record since 1984. Dividends are currently distributed on a quarterly basis.
Below is a chart showing annual Dividends Per Share for tracking historical trends.
Breaking Down Flexsteel Industries Inc's Dividend Yield and Growth
As of today, Flexsteel Industries Inc currently has a 12-month trailing dividend yield of 2.94% and a 12-month forward dividend yield of 2.94%. This suggests an expectation of same dividend payments over the next 12 months.
Over the past three years, Flexsteel Industries Inc's annual dividend growth rate was -5.50%. Extended to a five-year horizon, this rate decreased to -9.60% per year. And over the past decade, Flexsteel Industries Inc's annual dividends per share growth rate stands at -1.20%.
Based on Flexsteel Industries Inc's dividend yield and five-year growth rate, the 5-year yield on cost of Flexsteel Industries Inc stock as of today is approximately 1.77%.
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 2023-06-30, Flexsteel Industries Inc's dividend payout ratio is 0.22.
Flexsteel Industries Inc's profitability rank, offers an understanding of the company's earnings prowess relative to its peers. GuruFocus ranks Flexsteel Industries Inc's profitability 7 out of 10 as of 2023-06-30, suggesting good profitability prospects. The company has reported net profit in 8 years out of past 10 years.
Growth Metrics: The Future Outlook
To ensure the sustainability of dividends, a company must have robust growth metrics. Flexsteel Industries Inc's growth rank of 7 out of 10 suggests that the company 's growth trajectory is good relative to its competitors.
Revenue is the lifeblood of any company, and Flexsteel Industries Inc's revenue per share, combined with the 3-year revenue growth rate, indicates a strong revenue model. Flexsteel Industries Inc's revenue has increased by approximately 16.60% per year on average, a rate that outperforms than approximately 82.75% of global competitors.
Next Steps
In conclusion, Flexsteel Industries Inc has shown a steady dividend payment record, although the growth rate has been decreasing over the years. However, the company's low payout ratio and healthy profitability rank indicate a potential for sustainable dividends. Furthermore, the company's strong growth metrics, especially in terms of revenue, suggest a promising future. Therefore, while the current dividend scenario presents a mixed bag, Flexsteel Industries Inc holds potential for value investors with a long-term perspective.
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This article first appeared on GuruFocus.
