Dividend Coverage: This Energy Plants Builder has a Dividend Yield of 1.50%; Will Trade Ex-Dividend on October 19, 2017
LONDON, UK / ACCESSWIRE / October 18, 2017 / Pro-Trader Daily takes a closer look at Argan, Inc. (NYSE: AGX) as the Company's stock will begin trading ex-dividend on October 19, 2017. To capture the dividend payout, investors must purchase the stock a day prior to the ex-dividend date that is by latest at the end of the trading session on October 18, 2017. Are you looking for research on dividend stocks, if so register with us now for your free membership at:
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Dividend Declared
On September 14, 2017, Argan announced that its Board of Directors declared a regular cash dividend in the amount of $1.00 per share of common stock payable October 31, 2017, to stockholders of record at the close of business on October 20, 2017. In addition, the Company announced that its Board intends to declare a regular quarterly dividend of $0.25 per share of common stock starting in the first quarter of its fiscal year ending January 31, 2019.
Argan's indicated dividend represents a yield of 1.50%, which is substantially higher compared to the average dividend yield of 1.17% for Industrial Goods sector. Argan did not increase its dividend in the last year.
Dividend Insights
Argan has a dividend payout ratio of 25.9%, which indicates that the Company distributes approximately $0.26 for every $1.00 earned. The dividend payout ratio reflects how much amount a company is returning to shareholders versus how much money it is keeping on hand to reinvest in growth, to pay off debt, and/or to add to its cash reserves.
According to analysts' estimates, Argan is estimated to report earnings of $4.09 for the next year, which is more than four times its annualized dividend of $1.00 per share.
As of July 31, 2017, Argan's cash, cash equivalents, and short-term investments totaled $557 million and net liquidity was $288 million. The Company has no bank debt. For the six months ended July 31, 2017, Argan's net cash provided by operating activities totaled $34.58 million compared to $112.71 million for the year-ago period. The Company's strong financial position indicates its ability to absorb any fluctuations in earnings and cash flow and to sustain the dividend distribution for a long period.
Recent Development for Argan
On September 07, 2017, Argan announced that for its second quarter ended July 31, 2017, revenues surged 60% to a quarterly record of $260 million, primarily due to Gemma Power Systems (GPS) having reached peak construction activities on four large, natural gas-fired power plants.
Argan's gross profit increased 17% to $51 million, primarily due to the increased revenues, while gross margin percentage decreased from 27.1% to 19.8% compared to the prior year's same quarter, which primarily reflected the achievement of the substantial completion of two natural gas-fired power plant projects in the year-ago period. The Company's net income attributable to its stockholders surged 38% to $27.1 million, or $1.72 per diluted share, compared to $19.7 million, or $1.29 per diluted share, for the prior year's same quarter.
About Argan, Inc.
Argan's primary business is providing a full range of services to the power industry including the engineering, procurement, and construction of natural gas-fired power plants along with related commissioning, operations management, maintenance, and project development and consulting services, through its Gemma Power Systems and Atlantic Projects Company operations. Founded in 1961 and headquartered in Rockville, Maryland, Argan also owns SMC Infrastructure Solutions, which provides telecommunications infrastructure services, and The Roberts Company, which is a fully integrated fabrication, construction, and industrial plant Services Company.
Stock Performance
At the closing bell, on Tuesday, October 17, 2017, Argan's stock slipped 1.79%, ending the trading session at $65.95. A total volume of 139.06 thousand shares have exchanged hands, which was higher than the 3-month average volume of 126.41 thousand shares. The Company's stock price surged 2.89% in the last three months, 0.46% in the past six months, and 18.40% in the previous twelve months. The stock is trading at a PE ratio of 12.09 and has a dividend yield of 1.52%. The stock currently has a market cap of $1.02 billion.
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