Graco Inc. (GGG - Free Report) has announced that it is giving twin rewards in forms of share buyback authorization and hike in quarterly dividend to its shareholders. These rewards were approved by the company’s board of directors.
We believe that such disbursements reflect Graco’s shareholder-friendly policies and strong cash position.
Details of Share Buyback & Quarterly Dividend
Under the new buyback program, Graco was allowed to repurchase up to 18 million shares through open-market and negotiated transactions. In addition to this, the company is yet to buy back roughly 3.3 million shares from 6 million under the share repurchase program approved in April 2015.
Additionally, the company announced 20.8% or 2.75 cents per share hike in the quarterly dividend rate, which now increased from 13.25 cents to 16 cents. On an annualized basis, the dividend increased to 64 cents from 53 cents per share.
Graco will pay the revised dividend on Feb 6, 2019, to shareholders of record as of Jan 22.
Sound Capital-Allocation Strategies
Graco uses free resources for strengthening its growth prospects and rewarding shareholders through share buybacks, and dividend payments.
Over the last five years (2013-2017), Graco’s annual dividend payments increased from 33 cents per share in 2013 to 48 cents in 2017. In the first three quarters of 2018, the company distributed a dividend of 52 cents per share.
Regarding share buybacks, the company repurchased $155.6 million worth of shares in the first three quarters of 2018.
Zacks Rank & Stocks to Consider
With a market capitalization of $7 billion, Graco currently carries a Zacks Rank #2 (Buy). Healthy demand for products in the residential & non-residential construction, automotive, industry & machinery, and other markets will be advantageous. We expect that solidifying demand, as well as efforts for innovating products and improving margins, might support bottom-line growth in the quarters ahead.
We believe that improvement in profitability and strong cash position are likely to enable Graco to return higher value to shareholders in the years ahead. In the third quarter of 2018, the company’s adjusted net income increased 29% year over year. Further, its cash and cash equivalents were $137.6 million exiting the period.
Since the release of third-quarter 2018 results on Oct 25, Graco’s shares have yielded 5.2% return, outperforming 1.6% growth recorded by the industry.
Further, brokerage firms increased earnings estimates, reflecting positive sentiments for the stock. In the past 60 days, earnings estimates for 2018 have been raised by eight brokerage firms while that for 2019 have been increased by six. Currently, the Zacks Consensus Estimate for earnings stands at $1.88 for 2018 and $2.02 for 2019, reflecting growth of 2.2% and 2% from the respective 60-day-ago tallies.
Graco Inc. Price and Consensus
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
Graco Inc. (GGG - Free Report) has announced that it is giving twin rewards in forms of share buyback authorization and hike in quarterly dividend to its shareholders. These rewards were approved by the company’s board of directors.
We believe that such disbursements reflect Graco’s shareholder-friendly policies and strong cash position.
Details of Share Buyback & Quarterly Dividend
Under the new buyback program, Graco was allowed to repurchase up to 18 million shares through open-market and negotiated transactions. In addition to this, the company is yet to buy back roughly 3.3 million shares from 6 million under the share repurchase program approved in April 2015.
Additionally, the company announced 20.8% or 2.75 cents per share hike in the quarterly dividend rate, which now increased from 13.25 cents to 16 cents. On an annualized basis, the dividend increased to 64 cents from 53 cents per share.
Graco will pay the revised dividend on Feb 6, 2019, to shareholders of record as of Jan 22.
Sound Capital-Allocation Strategies
Graco uses free resources for strengthening its growth prospects and rewarding shareholders through share buybacks, and dividend payments.
Over the last five years (2013-2017), Graco’s annual dividend payments increased from 33 cents per share in 2013 to 48 cents in 2017. In the first three quarters of 2018, the company distributed a dividend of 52 cents per share.
Regarding share buybacks, the company repurchased $155.6 million worth of shares in the first three quarters of 2018.
Zacks Rank & Stocks to Consider
With a market capitalization of $7 billion, Graco currently carries a Zacks Rank #2 (Buy). Healthy demand for products in the residential & non-residential construction, automotive, industry & machinery, and other markets will be advantageous. We expect that solidifying demand, as well as efforts for innovating products and improving margins, might support bottom-line growth in the quarters ahead.
We believe that improvement in profitability and strong cash position are likely to enable Graco to return higher value to shareholders in the years ahead. In the third quarter of 2018, the company’s adjusted net income increased 29% year over year. Further, its cash and cash equivalents were $137.6 million exiting the period.
Since the release of third-quarter 2018 results on Oct 25, Graco’s shares have yielded 5.2% return, outperforming 1.6% growth recorded by the industry.
Further, brokerage firms increased earnings estimates, reflecting positive sentiments for the stock. In the past 60 days, earnings estimates for 2018 have been raised by eight brokerage firms while that for 2019 have been increased by six. Currently, the Zacks Consensus Estimate for earnings stands at $1.88 for 2018 and $2.02 for 2019, reflecting growth of 2.2% and 2% from the respective 60-day-ago tallies.
Graco Inc. Price and Consensus
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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