Advanced Energy Introduces Quarterly Dividend Plan; Shares Rise

Advanced Energy Industries on Dec. 14 announced the initiation of a cash dividend program starting from Q121. As part of the program, the manufacturer will pay a regular quarterly dividend of $0.10 per share. Shares gained 2.8% at the close on Monday.

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The annualized dividend of $0.4 per share will translate into a dividend yield of 0.4% at the current price.

Advanced Energy (AEIS) is a global designer and manufacturer of highly engineered, precision power conversion, measurement, and control solutions for critical applications and processes.

“We believe the initiation of a quarterly cash dividend program demonstrates confidence in our strategy and our commitment to consistently return capital to shareholders and enhance shareholder value,” Advanced Energy CEO Yuval Wasserman said.

AEIS shares have gained 42% YTD and are trading at a discount of 3.5% to their 52-week high. (See AEIS stock analysis on TipRanks)

The stock scores a Strong Buy analyst consensus based on 4 unanimous Buys. Following the share rally, the average price target of $103 implies upside potential of a more moderate 2.2% to current levels.

On Dec. 9. Rosenblatt Securities analyst Scott Graham reiterated a Buy rating on the stock with a price target of $120 on Dec. 9.

Graham “continue to believe AEIS will increasingly harvest the new sales opportunities in the” industrial, medical and data center computing divisions.

The analyst added “we have updated our end-market tracking data and believe each of these divisions will operate in much improved environments in 2021 and 2022. Finally, we expect some discussion on acquisitions in Industrial & Medical.”