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Welcome back to my weekly stock analysis. Disclaimer: I am not invested in this one.
Sector: Specialty Industrial Machinery (Industrials)
Standex International is a food service equipment manufacturer with segments in engravings, engineering, electronics, and hydraulics. The most recent news from SXI was the 2020 acquisition of Renco Electronics. Standex International is headquartered in New Hampshire, but has obvious international roots.
Strengths: - strong dividend growth rate - 11 years of growth - ok ebitda growth
Risks: - very low yield - moderately high PE ratio - Low debt to equity but slightly high debt to ebitda - revenue rises and falls every 7ish years
SXI: Numbers from Seeking Alpha as of Nov 07, 2021
Numbers from Macro Trends as of Nov 07, 2021
|Current Annual Payout/Share||$1.04|
|5 Yr Div Growth Rate||11.06%|
|3 Yr Div Growth Rate||9.82%|
|1 Yr Div Growth Rate||8.89%|
|Years Of Growth||11|
|Current Payout Ratio||18.47%|
|Free Cash Flow / Share||2.9626|
|Debt / Equity Ratio||0.3932806324110672|
|Debt / EBITDA||2.1397849462365595|
Looking at this, I would probably pass over it. Sure it has 11 years of growth and good dividend growth rates, but the returns and revenue are lacking. The debt ratios are off, with the redeeming quality of a very low payout ratio. This just seems like an ok company.
I will now use the 3 year dividend growth rate to project further.
For another way, let's use historical payout ratio to project out.
|EPS estimate 2021||5.63|
|EPS estimate 2022||5.88|
With how negative this company looks, why am I even bringing this up? Well for one, I think it's unusual for no real news to come out of this company outside of the 2020 acquisition. The Torotel acquisition and the selling Refrigerated Solutions Group should have impacted the stock. But the only dips I can see are on March 1, 2020, and July 1 2021. The divesting happened March 13, 2020. Even with the pandemic, this should have caused a drop. But no, the stock seemed to only go up. The company has recently made steps to further growth, so I am excited to see where that direction goes. Perhaps this is due to 91.5% institutional holdings, but something just doesn't seem right to me.
Weekly price estimate for a future date, via consulting the crystal ball: Predicted price for SXI for Dec 19, 2021: $128.26. There is no factual basis that I will give.
I hope someone out there found this post interesting. Please supplement this with your own research.
Thank you for reading, please give me feedback so that I can increase my standards for future analysis posts. If I have made a mistake, please correct me. Or if you have one that you want an analysis on, I might pick a comment to do an analysis of if I don't have any spice stored for the week.