Logitech International SA (LOGI - Analyst Report) recently announced that its board of directors has decided to initiate a recurring regular dividend, to be issued and paid on an annual basis. However, this is subject to final approval of the company’s shareholders at the Annual General Meeting to be held in Sep 2013, keeping in mind the relevant Swiss statutory requirements.
In this connection, the first payout has been fixed at CHF 0.21 (approximately 22 cents at the exchange rate as on May 22, 2013) per share. Annualized payout of the new recurring dividend affirms a yield of 3.3% with a stock price of $6.54 as of closing on May 22, 2013.
The company’s earlier dividend was a one-time special payment made in Sep 2012 totaling $0.847639 per share. In fiscal 2012 the company performed poorly with Operating income of $72 million, down 50 percent from $143 million a year ago and this lead to a sharp fall in the share prices. To combat this, the management decided to reward the shareholders with this one-time distribution utilizing the company’s strong cash position.
This time Logitech has been reaping the benefits of its recent performance growth. Concurrent with the announcement, Logitech also revealed its financial outlook for fiscal 2015 and 2016. With the current revised cost structure and new product line, the company expects to experience growth in coming years. In fiscal 2015, the company estimates sales of $2.1 billion, operating income of $90 million and gross margin of 34.5%. However, in fiscal 2016, performance is expected to be even better with sales of $2.25 billion, operating income of $150 million and gross margin of approximately 35 percent.
Logitech currently has a Zacks Rank #3 (Hold). Other sector participants are performing better, with Electronics for Imaging, Inc. and Synaptics Inc. (SYNA - Snapshot Report) carrying a Zacks Rank #1 (Strong Buy), and eMagin Corp. (EMAN - Snapshot Report) having a Zacks Rank #2 (Buy)