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Kadant's (KAI) Board Okays Quarterly Dividend & Share Buyback

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Kadant Inc. (KAI - Free Report) yesterday announced twin rewards for its shareholders in the forms of quarterly dividends and a share buyback program. Such shareholder-friendly policies of the company reflect a strong cash position.

Notably, the company’s cash and cash equivalents were $66.7 million, whereas its cash flow from operating activities in the quarter totaled $19.1 million and free cash flow was $16.8 million.

Inside the Headlines

As revealed, Kadant’s board of directors approved the payment of a quarterly dividend of 25 cents per share to shareholders of record as of Jul 15. The disbursement will be done on Aug 12.

The company’s board of directors approved a share buyback program worth $20 million. The program equips it to repurchase equity shares, either through private or public transactions. The program will be valid from May 20, 2021, to May 20, 2022.

Notably, Kadant’s earlier-approved $20-million share buyback program expired on May 13, 2021.

Sound Shareholder-Friendly Policies

The company firmly believes in rewarding shareholders handsomely. Its dividend payout amounted to 24 cents per share or $2.8 million in the first quarter of 2021, representing an increase from 23 cents or $2.6 million paid out in the year-ago quarter. Moreover, the company refrained from repurchasing shares both in the first quarter of 2021 and the year-ago quarter.

In the quarter ahead, impressive financial performance and cash generation will likely enable Kadant to continue with its shareholder-friendly policies.

Zacks Rank, Price Performance and Earnings Estimate Trend

With a market capitalization of $2 billion, Kadant currently carries a Zacks Rank #3 (Hold). The company is poised to benefit from improving demand, solid bookings and recovering market conditions. However, the challenges related to the pandemic still are concerning.    

Year to date, the company’s shares have increased 16.3% as compared with the industry’s growth of 10.4%.


The Zacks Consensus Estimate for its earnings is pegged at $6.07 for 2021 and $6.67 for 2022, reflecting respective increases of 4.1% and 1.8% from the 30-day-ago figures. Likewise, the estimate for second-quarter 2021 is pegged at $1.51, reflecting growth of 10.2% from the 30-day-ago number.

Kadant Inc Price and Consensus


Kadant Inc Price and Consensus

Kadant Inc price-consensus-chart | Kadant Inc Quote

Other Players Actively Engaged in Rewarding Shareholders

Three other players in the industry, which announced rewards for shareholders in the ongoing quarter, are Illinois Tool Works Inc. (ITW - Free Report) , IDEX Corporation (IEX - Free Report) and Parker-Hannifin Corporation (PH - Free Report) .

This month, Illinois Tool announced a hike in the share buyback program as well as the quarterly dividend payment. The company presently carries a Zacks Rank #2 (Buy). Its earnings estimates for the current year improved in the past 30 days. Earnings beat for the last reported quarter was 11.05%.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

IDEX, currently carrying Zacks Rank #2, announced an 8% hike in its quarterly dividend rate this month. In the past 30 days, its earnings estimates improved for the current year. Earnings beat was 7.09% for the last reported quarter.

Parker-Hannifin, in April, announced an increase of 17% in its quarterly dividend rate.  In the past 30 days, the company’s earnings estimates expanded for the current year. Earnings beat was 9.60% for the last reported quarter.

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