Patrick Industries has ramped up its quarterly cash dividend by 12% to $0.28 per share from $0.25. The building products and materials manufacturer for recreational vehicles and industrial markets said that the new dividend will be paid on Dec. 14 to shareholders of record as on Nov. 30, 2020.
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Patrick’s (PATK) annual dividend of $1.12 per share, now reflects a dividend yield of 1.8%. The company’s CEO Andy Nemeth said “in alignment with our capital allocation strategy, the decision to increase the dividend reflects the continued confidence of both management and the Board in the Company’s strategic and financial position and the strength of our cash flows, and represents our ongoing commitment to increasing long-term shareholder value.”
The dividend hike followed the company’s completion of the acquisition of aluminum components manufacturer, Geremarie Corporation, last week. Patrick anticipates the Geremarie acquisition to be immediately accretive to its earnings with 2020 revenues of approximately $44 million expected in 2020. (See PATK stock analysis on TipRanks)
On Sept. 29, Robert W. Baird analyst Craig Kennison, said that the strong demand and lean inventory will support a significantly extended replenishment cycle.
Kennison reiterated a Buy rating with a price target of $78 (26.7% upside potential) on the stock. Shares have risen by about 17.4% year-to-date.
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